BrightSpring Health Services Aktie

Hi, good afternoon, everyone. I'm Erin Wright, health care services analyst at Morgan Stanley, and welcome to the Morgan Stanley Global Healthcare Conference. For more important disclosures, please see the Morgan Stanley research disclosure website at morganstanley.com/researchdisclosures.

And with us today this afternoon, we have BrightSpring Health Services. With them, we have CFO, Jennifer Phipps. Thank you so much for coming. We look forward kind of to a great conversation here in terms of the fireside chat. So thank you.

Yes. Thanks for having us.

So we'll get right into it. You recently raised your 2026 guidance again in July with adjusted EBITDA now expected to be in that sort of $820 million to $845 million range. Can you bridge us to the latest increase and discuss what is now embedded in terms of your second half expectations? Where do you have the most visibility and which assumptions might, I guess, contain the greatest variability?

Yes. No, thanks for the question. We obviously had really strong performance first half, 44% EBITDA growth year-over-year. We expect continued strong growth embedded in our guidance throughout the rest of the year. Some of that outperformance has been in volume and was broad-based across all of our different business lines. So as we think about both the Pharmacy and Provider businesses, both have performed really well from a volume perspective. We had new LDD wins, many in the first half. We've had some new ones that we've launched since we last spoke at quarter end. And then we've had some updates on the pull-through associated with those.

We've had EBITDA performance, again, broad-based across both segments and performance. We've had -- generics have performed ahead of expectations are expected throughout -- growth throughout the rest of the year. And then we've had lean and automation efficiency initiatives that have come online. And as those have been implemented, we've been -- we felt comfortable to put that into our guidance as well.

As we think about our philosophy, we continue to put out guidance that we have a high confidence in our ability to deliver under a number of various different scenarios, and we're always working to exceed those expectations, again, with volume growth underpinned by our high-quality services and maximizing leverage of our lean and automation and across our cost structure.

Okay. That's great. So I don't want to get too much into the modeling details here, but I -- given that there were a lot of investor questions on that quarterly progression in the first half, I do have to ask. So the second quarter gross profit per script, about, I think it was $27.50. It was down sequentially from the first quarter, though it was up 28% year-over-year. You noted that the first quarter did include about $1 per script or so of normal seasonality uplift. What is the seasonality attributable to how much uplift was from early conversion of Pomalyst or or Revlimid? And how should we think about the sustainable baseline for gross profit per script into 2027? What would create some of that upside, downside?

Yes. So we -- I'd just like to mention that we manage our company ultimately for long-term, sustainable and durable GP dollar and EBITDA dollar growth. GP per script ultimately is an output of 75 different factors across all of our different business lines and performance there. But as it relates -- and we do expect sequential growth throughout the rest of the year in terms of GP dollars. We did mention that we expect stability to maybe slight benefit in GP per script throughout the rest of the year. So those are some things that we have -- that we've mentioned during the call after the quarter.

The seasonality really relates to something that happens every first quarter and it relates to price appreciation occurs on branded drugs. So to the extent that we have any inventory on hand at the end of the year in advance of our price appreciation, we get the benefit associated with that, and that typically happens in Q1. That tends to be, at least the last couple of years has been a very similar dollar impact. And so we did provide the dollar impact per script as it related to the seasonality throughout the rest of the year.

And what about the conversion impact of some of these biosimilar kind of opportunities? Is that flowing through meaningfully for you? How do we think about that?

So from a generic standpoint, so we [ don't ] have a lot of biosimilars that's more related to infusion. But from a generic standpoint, we have a number of different drivers that are impacting ultimately, our profitability. Those items, from a pharmacy perspective, are certainly volume growth, new LDD wins, the ramp of LDD wins that we've had, generic conversions and then the growth of those generics as they ramp throughout the incremental component. We think of those generics as being a net tailwind ultimately across each of the next several quarters. Then ultimately, infusion. You have volume growth across those from a driver perspective and then improve profitability and margin expansion. And then in the Home & Community Pharmacy as we think about those drivers and leverage leverage our cost per script is really kind of the primary focus in addition to volume growth that we're focused on.

Okay. So bigger picture, sort of gross profit per script, as I was mentioning before, up 28% in the second quarter, up 50% in the first quarter year-over-year, up 21% in -- throughout your fiscal 2025, but for the years before 2025, it was roughly flat. So can you give us a little bit more context on what really has driven that inflection in some of what durable as we head into next year?

Yes. So one of the things to remember, and this is why I mentioned early on that we're focused on the dollar growth in addition to obviously managing each of the components of script growth for each different business that we have. Mix is -- definitely has an impact as each of those different pharmacy businesses has varying different GP and EBITDA profile, and we're focused on driving maximum growth across each individual business line, which can then play out from a script standpoint. So if you were to go to '24, you're right, like there were periods where we had a negative GP per script, but really significant GP dollar growth or even, in some cases, margin expansion. And that was really a mix-related dynamic.

So again, we think the right metric to focus on is the dollar growth, but ultimately, from a sustainability standpoint, we've continued to drive outsized volume in certain areas like specialty pharmacy, which has a higher script growth as well.

Okay. Great. And then at your Investor Day in March, you outlined long-term guidance of 15% to 20% organic EBITDA CAGR through 2028. That's nicely ahead of kind of prior targets that were alluded to kind of during the IPO process of high single-digit EBITDA growth. So how do we think about the continuation of sort of the momentum that we're seeing? Can you walk us through some of those key growth drivers? What they've been for BrightSpring over the past 2 years, but what they -- what we should see in terms of kind of growth over the next couple of years here?

Yes. So over the last couple of years and what we see playing out into the next couple of years, there's been a handful of drivers of that growth. Number 1 is ultimately volume underpinned by our high-quality services. That was broad-based across many different businesses, but specialty pharmacy has had an outsized growth over that time period. Again, I would say the second being the specialty pharmacy and the attractive market and our leading market position that we have across the pharmacy business. And then Number 3 would be we've had really strong provider growth, which has contributed to the bottom line in the second quarter.

From an organic standpoint, the Provider business grew almost 20% on an organic basis, significantly more if you include the Amedisys acquisition. Leveraging our scale and efficiency, so we think that, that has provided a lot of meaningful value. Our ability to contract from a payer standpoint, our ability to contract on the cost side and then certainly drive lean and automation.

Fifth would be infusion. And the work that we've been doing there. We've invested a lot of money over the last couple of years, a lot of money and time as we're working to really build out a platform for growth there. And I think, as we look forward, we see that being a meaningful contributor over the next couple of years, has been a contributor over the last year, 1.5 years after a couple of years of really being stable. And then on the Home & Community side, I would point out we believe that there's a lot of opportunity for automation and efficiency and driving pretty significant dollar per script growth. So as we look across all of those different areas, we just really see the ability to continue to leverage and perform well across our platform.

Okay. And anything to call out as we think about the second half in terms of pharmacy services, I mean -- or the Pharmacy Solutions segment, I should say? How do we think about more nearer-term dynamics that we should keep in mind from a modeling perspective?

Yes. We continue to expect sequential growth. And we think the primary drivers of that are going to be the things that we talked a little bit earlier about, new LDD wins that we have launched either earlier this year, some that we've recently announced post the Q2 earnings, the ramp of those historical LDD wins that are going to provide growth in terms of revenue, GP and EBITDA dollars, the generic conversions, continued growth in those and opportunity on the cost side. Fee-for-service that grows with those LDDs certainly is important. Volume growth in infusion and leveraging our Home & Community lean and automation work that we're doing, all of which are contributing to EBITDA growth that we expect in the second half.

Okay. And you mentioned some LDD wins. So let's go there. So as of the second quarter, the company had 155 LDDs and have launched, I guess, about 12 products, I think, year-to-date, 4 exclusive, I think you call ultra-narrow. I guess how does this compare to kind of your original expectations? And what's kind of remaining in terms of launch pipeline? How does that LDD pipeline kind of look for you? And were these a couple of new wins even since the most recent quarter?

Yes. So we did recently launched 2 new -- we've actually announced a few on our Onco and CareMed website. We usually announce the bigger ones. But we've announced a couple of new launches in both rare and orphan space and also in the oncology space. The pipeline remains robust. And so we typically are working with manufacturers about -- we typically know if we're going to participate in a launch oftentimes 12 months before a launch. So we have pretty good insight into what we were expecting 2026 and how we would expect that to play out. We're starting to work with manufacturers, obviously, on '27 launches and what that'll look like. So we usually have pretty good insight into what that looks like a little bit further out. We can't announce that or talk about that until the drug is actually launched.

It's been a good year in terms of the pipeline of drugs. It remains robust. And we -- as we continue to work with manufacturers on upcoming drugs, we believe that the leading and high-quality services of our Specialty platform, the high-touch services and white glove services that we're able to provide on behalf of the manufacturers to service their drugs, our time to first fill and medication possession ratio and our patient satisfaction and physician satisfaction scores have led to our ability to continue to serve these populations and these drugs and new drugs coming to market.

Can you comment a little bit on the recent FDA cancer drug approvals, the opportunities with the recent pancreatic cancer drug? Can you discuss kind of, I guess, some of those more recent LDD wins?

Yes. So there was a new drug that was launched earlier this month, I think it was the beginning of September, where there was a new pancreatic cancer drug that was launched, Rasonque from Revolution Medicine. We're excited to participate in that drug as a partner on that drug and what that drug is doing and the novel nature in service of patients with pancreatic cancer. We're just really proud to partner with the manufacturers on that.

We also had a notable rare drug win. That was not a new LDD, but ultimately a switch from a different -- and that was an exclusive drug, Orladeyo. So that's another -- just another example of a drug that we're excited to partner with manufacturers in the service of their drug in their market.

And for the pancreatic cancer drug approval, for something like that, it's not necessarily like the super ultra narrow probably in terms of -- or how exclusive would the nature of that relationship be?

So it's a network of 2. So from a specialty -- so the drugs that go through the hospital channel are not -- we would not necessarily participate in that. But we would service and be 1 of 2 pharmacies servicing that drug in the specialty pharmacy market.

Okay. And then oncology remains kind of I think the Onco360 business at [indiscernible] within kind of the BrightSpring ecosystem. 93% of your specialty pharmacy business is tied to oncology, which I think you view as sort of a nice durable kind of market. What else is kind of, from a pipeline perspective, you're -- are you encouraged with what you're seeing from an innovation standpoint, presumably you are? And how do we think about the mix of oncology versus other complex therapies over time?

Yes. No, we just continue to see a lot of unique drugs in the oncology and rare and orphan space in the specialty pharmacy space. We continue to see the need for high-quality specialty pharmacies to help service narrow or exclusive networks. And so we're excited to be able to be a partner to manufacturers in support of that drug. As we look out from a pipeline perspective, there are a number of drugs that continue to be in Phase III for FDA approval and the pipeline remains robust.

Our team is constantly thinking about how can we utilize our unique specialty pharmacy network services across different disease states, and rare and orphan is an area that we are very interested in continuing to participate. We've had some notable wins in this space over the last couple of years, and we're excited to continue to partner with manufacturers in this area. But we do -- we're constantly looking out in terms of additional areas of specialty pharmacy, where we think our unique high-touch pharmacy network that works in exclusive and ultra narrow areas might be additional opportunities in the future over the coming years.

Okay. And then hub services, you've highlighted hub services and other fee-for-service programs as a growing contributor to specialty pharmacy. And as a way to deepen those manufacturer relationships that you have, can you describe a little bit about the breadth of your hub capabilities today? How the economics compare with kind of the core dispensing business? What -- how meaningful of a contributor is the hub services business?

Yes. So in support of a drug, we're able to really design programs that really will do whatever is necessary typically to support a patient or a manufacturer for patients on that drug. So that sometimes looks like just data back to the manufacturers, helping them understand the patient journey. A lot of times, it involves other things like it could involve designing hub services where patients can -- we have a lot of communication with those patients where they're directly communicating with us about any needs they have on the drug. And then we're able to provide that information back to manufacturers.

It really can be whatever the manufacturer feels would help benefit the outcomes. Ultimately, these services are used to produce better outcomes for the patient and more effective treatment in the care of the patients on these drugs.

Okay. A little bit on Infusion. I believe kind of if you gave some -- or you indicated that Infusion was approximately, I think, 70% of quote second quarter kind of showed solid growth, both acute and chronic. I guess you're beginning to integrate some of the payer contracting and purchasing more closely with the broader [indiscernible] platform. Can you talk a little bit about the opportunities you're seeing across infusion? And where ultimately that mix shakes out in terms of acute versus chronic and geographic areas of focus which ones are the highest priority for you?

Yes. We are putting resources to both because we think there's interesting opportunities across both. So from an acute standpoint, we think density in our current markets is very important, certainly important as we are trying to leverage our scale across our provider and payer payer negotiations. We also -- there are some markets that we're not in today that are very interesting to us that we think that we could provide our high-quality infusion services at.

From a chronic standpoint, we are really focused on very specific drugs and end markets for drugs that we think are very interesting. So how do we build out the right sales force, the right infrastructure to be able to deliver really high-quality care. So Jon's talked a little bit the last couple of quarters, for example, about a program that we created called IG Connect. So individuals that are on IVIG medications, for example, how can we help them through their life cycle of IVIG medication in a white glove way, similar to some of the services that we do in like a specialty pharmacy. How can we bring those to help ensure better adherence, better outcomes ultimately for patients that are on that.

So those are things that we're doing that we think are differentiated and ultimately will be helpful for growth in those areas.

Okay. Home & Community Pharmacy, revenue declined in the most recent quarter that reflects IRA and some customer exits, I believe. So -- yet the EBITDA, I guess, increased because of some of the internal efficiency initiatives that you have in technology investments that you've made. I guess, how do you think about full year -- or how do you think of the long-term kind of dynamics around IRA and drug pricing dynamics across that business? And then what's the long-term profile of that Home & Community Pharmacy business?

Yes. Really great question. From a revenue standpoint, we do expect continued decline in revenue throughout the rest of this year from IRA. So we've seen about half of the impact through the first half of what we had talked about. We -- as we look forward to the 2027 drugs, certainly the largest drugs were impacted first. And so what we've said is we expect the impact in '27 to be about half of the impact that we're seeing in 2026.

Despite that, as you mentioned, we have we have grown. Certainly, for '27, we're working to continue to further mitigate any IRA impacts that we have. That would include what could be additional impacts for -- or additional mitigations for drugs that were even on the 2026 list. And then in addition to that, we certainly have a number of lean and efficiency and then volume growth that we would expect that would ultimately produce meaningful EBITDA growth in that business as well.

Okay. So since you're kind of talking about some regulatory dynamics I guess. Can you separate direct 340B economics from indirect exposure for you through referral sources, hospital customers or manufacturer contracting under what sort of 340B reform might you face risk versus potential share opportunity?

Yes. So from a 340B perspective, where we have some 340B support is in our specialty pharmacy and related to LDD drugs. What I would say is that we have a very transparent model with our hospital partners, and we work to be a true partner to them in providing some of the drugs where they might not have the ability to provide that drug to their patients.

So as we look at the economics, it's not significantly differentiated compared to a normal -- our normal economics on the dispense of a drug. But as we -- 340B is certainly a really important program for hospitals, has been very meaningful to drive support of their patients. And so certainly, we just look to be a partner to those hospitals. And to the extent that there is reform, although we don't necessarily have a view on where that would happen, we see it more as an opportunity where -- or continuation of what we're servicing because these patients are in need of these drugs. So [indiscernible] go through the specialty pharmacy channel, there would not be a meaningful shift from our standpoint.

And then maybe a bigger picture question on just PBM and PBM economics as they move towards this greater fee transparency or delinking from traditional rebate models. How do you expect that would affect kind of an independent specialty pharmacy like BrightSpring?

Yes. I think what you're referring to are some of the rebates and the linking of rebates. We don't have rebates on our side. But again, we are focused on -- across our specialty platform largely from a brand standpoint on LDDs that are exclusive or ultra narrow and being able to provide these drugs to the patients. We've been able to work productively with payers on these LDD drugs that are very important to patients. So we don't really see -- we don't necessarily expect that to impact us. We would expect to continue to have similar opportunity sets across our platform.

Okay. And then staying on the topic of regulatory, but CMS also has proposed a 2027 home health rule that would increase aggregate I guess, payments by 2.4% versus 2026? What's your thoughts on that? Any sort of high-level feedback?

Yes. We were very encouraged to see the rate increase. They essentially kept the temporary rate flat and then provided the normal cost of living adjustments from a rate perspective. And that was consistent with a lot of the conversations that we've had. We have a really strong government relations team. We actually have a couple -- we have a really strong federal team that has experience both at payers at CMS across a number of different areas. And oftentimes, we are leading -- we are one of the leading voices for the industries that we're in across across CMS and legislatively.

And so we continue to advocate for the really important work that is being done by home health providers and ensuring that there's appropriate compensation and rate support for those services that are producing meaningful outcomes for patients.

And you recently reaffirmed kind of your commitment to kind of the home health category and business that you have. You closed the acquisition of Amedisys LHC. Can you talk a little bit about your expectations across that business? I think you've been running ahead of plan in terms of the EBITDA contribution. How is integration progressing? What's driven the improved outlook? What integration milestones remain from here?

Yes. Really great question. We were obviously really excited for the opportunity to acquire those branches. That acquisition is performing really well and is performing ahead of plan, both in terms of volume as well as some of the margin expansion opportunities. It's been a lot of work to -- we've effectively doubled the size of our home health business and the number of branches that we have. Certainly, a lot of IT and other integration work to make sure they're on our processes, our policies, but those were really high-quality branches and high-quality teams and processes. So it really has been a pretty smooth transition into our processes and what we're doing from a work standpoint.

We think that there's obviously continued growth that we'll expect out of that acquisition, including really, we would expect to be run rating at our home health margins probably 6 to 9 months from now, fully run rating at those margins. So we're continuing to see that margin increase and it's performing really well.

And then how is your acquisition pipeline shaping up relative to your expectations? And are you seeing some greater opportunities across pharmacy versus provider? How do you think about weighing those opportunities? Is it still like $100 million a year, the right annual deal spend? I mean if you back into kind of what's implied in the long-term guidance, it could be vastly bigger than that. So I'm just curious, is there -- what's your capacity and appetite for deals at the moment?

Yes. Really great question. We have -- we're really proud of the position we are now in from a leverage position. At the end of Q2, we were at 2.15x levered with a path to be well under 2x by the end of the year outside of M&A or other use of capital, which is below our long-term target of what we've said is 2.5x or below, giving us a lot of opportunity for M&A. It is our belief that our ability to do highly accretive M&A is still one of the best uses of our capital dollars and our corporate development team is fantastic and has done a really good job executing really well over the last 9 years across many different deals and with an almost flawless record in terms of EBITDA being higher than where we acquired it.

So that team -- we have a robust pipeline across all of our different businesses. It's -- we have a lot of -- we're able to really look across a lot of different areas and a lot of different businesses and say, what's the most attractive opportunities for us now? So each business, we have targets, target geographies, target density as we try to build out more services across different areas. What are the areas we want to look at, and we can look out across many different deals and target the most attractive opportunities for us, which we think is a differentiation for BrightSpring.

We remain interested -- I would say the areas we remain most interested would be home infusion and our ability to target pharmacies in some key market areas. I would say, hospice, rehab, those are also very interesting to us. But again, we're able to look across all of our different businesses as we think about this. I would say, from a target size perspective, we'll continue to be very focused on every deal being the right strategic fit, at a reasonable multiple that we think is accretive over time. And then as we think about that use of capital, we'll probably continue to do the really highly accretive tuck-in M&A, under $3 million deal sizes, I'd say we'll still continue to do a number of those deals.

I think our cash position has put us to a place where maybe we can do more of the $5 million to $15 million deals. We haven't done very many of those over the course of the last couple of years as we've been really focusing on deleveraging. And then might we do 1 or 2 $15 million to $30 million deals over the next couple of years, I think that's sort of how we're thinking about M&A.

Okay. One of the biggest -- I'll end with this huge question. One of the biggest questions we get from investors to is like, can you keep the momentum going in pharmacy and Pharmacy Solutions? And can you still continue to win LTD?s And like I think it's -- whether it's being unencumbered or just your expertise or data solution or hub services, like which one of those, how would you rank those in terms of when you're kind of competing for sort of that LDD wins, what's the most important for them?

I think really having high-quality services, and for us, some of the evidence of that are time to first still being significantly better than many of the market players, medication possession ratio, which is an adherence measure being really high and much better than a number of the players and then really high patient and physician satisfaction scores, which has been very helpful. And then certainly, I would say the team has done -- the operational team has done an excellent job of just performing on the drugs that we have access to. And so that has been continued to provide, I think, the excitement around our specialty pharmacy business and what they're able to execute on with new opportunities.

Great. Thanks so much. Appreciate the time.

Yes. Thank you.

Thank you for standing by, and welcome to BrightSpring Health Services Second Quarter 2026 Earnings Conference Call. [Operator Instructions]

I would now like to hand the call over to David Deuchler, Investor Relations. Please go ahead.

Good morning. Thank you for participating in today's conference call. My name is David Deuchler with Investor Relations at BrightSpring. I'm joined on today's call by Jon Rousseau, Chief Executive Officer; and Jen Phipps, Chief Financial Officer.

Earlier today, BrightSpring released financial results for the quarter ended June 30, 2026. A copy of the press release and presentation is available on the company's Investor Relations website.

Please note that today's discussion will include certain forward-looking statements that reflect our current assumptions and expectations, including those related to our future financial performance and industry market conditions. Such forward-looking statements are not guarantees of future performance. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from our expectations. We encourage you to review the information in today's press release and presentation as well as in our quarterly report on Form 10-Q that will be filed with the SEC, including specific risk factors and uncertainties discussed on our Form 10-K and Form 10-Q. Such factors may be updated from time to time in our periodic filings with the SEC, and we do not undertake any duty to update any forward-looking statements, except as required by law.

During the call, we will use non-GAAP financial measures when talk to you about the company's financial performance and financial condition. You can find additional information on these non-GAAP measures and reconciliations of our non-GAAP financial measures to their most directly comparable GAAP financial measures to the extent available without unreasonable effort in today's press release and presentation, which again are available on our Investor Relations website.

This webcast is being recorded and will be available for replay on our Investor Relations website.

With that, I will now turn the call over to Jon Rousseau, Chief Executive Officer. Good morning, everyone, and thank you for joining BrightSpring's Second Quarter 2026 Earnings Call.

I'd like to start by thanking everyone at BrightSpring who drives our mission forward and makes a lasting impact every day. We're grateful for the hard work and commitment of all of our teammates, enabling us to deliver high-quality and timely care to patients in so many communities across the U.S.

As we grow the BrightSpring platform, we remain focused on our important role and value proposition of delivering quality services and compassionate care to patients in lower cost and, most often, patient preferred settings. Our strategy is aligned with many secular trends in U.S. health care, and we are focused on strong execution, thoughtful innovation and continuous improvement to drive greater impact and sustained growth.

Our business continues to be underpinned by quality and operational performance, and these fundamental and critical enablers go hand-in-hand with patient volume increases, expansion into adjacent and new markets, and disciplined capital allocation. We see many opportunities for the company in the years ahead.

Turning to the second quarter. We were pleased with the performance across the organization, which reinforces our conviction in the value that we provide to patients and stakeholders across the country. Financial results for the quarter came in ahead of baseline expectations with total company revenue of $3.9 billion that represented 23% year-over-year growth and adjusted EBITDA of $206 million that grew 44% year-over-year.

In the segments, Pharmacy Solutions revenue of $3.4 billion represented 22% growth year-over-year and adjusted EBITDA of $180 million represented an increase of 44% versus last year. In Provider Services, revenue of $466 million represented 30% growth and adjusted EBITDA of $75 million increased 33% versus last year.

In Pharmacy Solutions, we saw continued business momentum in the second quarter. Our Specialty and Infusion business delivered revenue growth of 30% and script growth of 31%, reflecting strong performance from the clinical, operational and commercial teams, and relationships developed with manufacturers, physicians and patients over the years.

Our Specialty business continues to be driven by the branded oncology LDD portfolio, while we continue to leverage proven and core capabilities and expand into other targeted therapeutic areas including certain rare, orphan and other complex therapies with noteworthy partnership wins in these areas. During the quarter, we added 2 ultra-narrow network LDDs to our portfolio bringing the total number of LDDs to 155. For the year, we have launched 12 LDDs through Q2, 4 as exclusive partners and 8 ultra-narrow. And we, of course, continue to be extremely committed to our manufacturing and biotech partners and patients to deliver the best possible service support and experience for these life-changing and life-saving therapies. Additionally, we continue to see solid contribution from generic scripts, driven in part by newly-available generic alternatives last year and this year.

The Infusion business delivered solid volume growth across both acute and chronic therapies in line with expectations, driven by operational initiatives and service levels as well as growth investments and execution this year. We plan to expand both the acute and chronic footprint into new markets in the future and are optimistic about the opportunity to scale this business.

In Home and Community Pharmacy, we continue to operate at a high level with service levels and controllable customer retention at all-time highs, as we serve a variety of growing end markets, including assisted living, behavioral, hospice, PACE, skilled nursing and others. Second quarter volume and revenue performance in the Home and Community Pharmacy business was impacted by the exit of certain skilled nursing customers last year and earlier this year, which in some cases has helped improve profitable growth year-to-date.

We continue to invest in automation and technology to improve efficiency and service across our scaled national footprint, and the positive impact of these initiatives was reflected in the profitability of the business in the quarter, which was up year-over-year.

On the Provider side, the Home Health Care business performed well, driven by strong need and demand for these valuable services and continued volume growth above industry levels as well as de novo investments, preferred MA and ACO contract execution and contribution from acquisitions, all underpinned by leading quality results across the provider service lines. We are pleased with the integration of the Amedisys and LHC branches, with the Home Health team doing a great job of integrating, particularly in the areas of HR and IT, all while we continue to have nearly 95% of our branches at 4 star or better. We now expect an EBITDA contribution of approximately $35 million in 2026 from these acquired branches.

Our hospice services continue to demonstrate industry-leading quality metrics and strong census growth. The Rehab Care business continues its long-standing performance with continued payer contract advancements for these highly clinical neurotherapy programs, entry into new markets and programs like rehab and motion resonating with patients and customers. All retention metrics for our clinicians continue to improve every year with retention at best practice levels.

Personal Care continues to provide consistent high-quality supportive care to patients who need assistance with activities of daily living in the home, with a growth rate in hours served well above the industry growth rate. And in our home-based primary care business, our quality measures are extremely good, demonstrating significant reductions in hospitalizations and overall health care costs realized by patients in our network. We continue to expand and invest in business development in this service line while further integrating with home health and hospice, also laying the groundwork for future growth and quality-based payment models.

At the corporate level and across the organization, we continue to invest in and progress on key clinical, HR and operational systems and new applications, including leveraging new automation and AI tools and agents in areas such as hiring, onboarding, intake, documentation, medication reviews and patient care plans. We've now had almost 300 employees receive Lean Sigma certification of various belts while completing Lean projects for each across the organization as we further institutionalize Lean business processes every year.

On acquisitions, we have a full pipeline per usual. And while we remain very disciplined in executing deals that clearly meet our strategy objectives, we are optimistic about possible transactions in the second half having signed several small tuck-ins and geographical expansions in the past quarter.

Now let me provide a few more financial highlights from the second quarter, which Jen will discuss in greater detail in a few minutes. As a reminder, the company's financial results referenced pertain to continuing operations and do not include results from the Community Living business, which was divested on March 30, 2026.

Second quarter financial results came in ahead of baseline expectations, with total company revenue of $3.9 billion, representing 23% year-over-year growth. Pharmacy Solutions revenue of $3.4 billion and Provider Services revenue of $466 million represented 22% and 30% growth, respectively.

Second quarter adjusted EBITDA of $206 million grew 44% year-over-year, representing an adjusted EBITDA margin of 5.3%, an 80 basis point improvement versus last year. Profitability in the quarter again benefited from the scale and complementary diversification of our platform across our target Home and Community end markets, which enables tangible advantages, including breadth and optionality of opportunities for revenue generation, disciplined operational execution leveraging top-down driven best practices, procurement and contracting processes across the organization, the cumulative impact of our lean and process improvement programs, ongoing technology and AI investments and our acquisition integration capabilities and synergies. Many initiatives contributed to the profitability and margin performance in the quarter, and these remain an important source of ongoing efficiency generation going forward.

From a cash flow perspective, the company generated $144 million of cash flow from operations in the quarter, excluding a onetime cash tax payment of approximately $100 million related to the Community Living transaction. Leverage was reduced to 2.15x as of June 30, 2026. We now expect approximately $600 million of operating cash flow this year with EBITDA to operating cash conversion of around 70%, and leverage for the year to end below 2x before any potential acquisitions. Also in the quarter, we received ratings upgrades from both S&P and Moody's, and we refinanced our debt at a 50 basis points lower spread.

As mentioned, performance in the quarter was underpinned by consistent focus on quality of care and patient satisfaction. Additional quality measures of note include an industry-leading timely initiation of care of 99% in Home Health, hospice quality measures that continue to be well above the national average, with a CAHPS overall hospice rating of 89%, rehab patient satisfaction scores above 97% and client satisfaction scores of 4.6 out of 5 in Personal Care.

On the Pharmacy side, in Home and Community Pharmacy, dispensing accuracy with 99.98%, order completeness was 99% and on-time delivery was 94.3%. While in Infusion, our patient satisfaction score was 94%, with 94% of discharges due to completion of therapy. Specialty Pharmacy demonstrated quality metrics well above the national average in the second quarter, delivering a high medication possession ratio of 93% and time to first fill of 3.7 days, with industry-leading Net Promoter Scores. We are very pleased to consistently demonstrate exceptional service and quality across our businesses.

Earlier this month, CMS released the calendar year 2027 preliminary rate for home health services. The preliminary rates include a positive annual payment update, the first such upward adjustment in several years and a positive starting point. We continue to work with CMS and Congress to highlight third-party data showing the positive health outcomes and lower Medicare cost profile of high-quality, clinically-appropriate and medically-necessary home health services.

To close, the second quarter reflected consistent execution that we strive for every day, with broad performance and steady progress towards our operating and growth priorities. We are building upon a strong foundation of growth, anchored on quality to drive scale while we deploy best practices and processes across the organization to continually improve operations for the future. As we move into the second half of the year, the business is well positioned, momentum is broad-based, and we are confident in our ability to deliver the updated full year guidance Jen will discuss in a moment.

With that, I'll turn the call over.

Thank you, Jon. As a reminder, we closed the Community Living transaction on March 30, 2026 and all financial results reflect only continuing operations with Community Living results reflected in discontinued operations.

For the second quarter of 2026, the company revenue was $3.9 billion, representing 23% growth from the prior year period. Pharmacy Solutions segment revenue in the quarter was $3.4 billion, achieving 22% year-over-year growth. Within the Pharmacy segment, Specialty and Infusion revenue was $2.9 billion, representing growth of 30% from prior year, which was driven by branded LDDs and new LDD launches script growth, as well as wraparound fee-for-service program growth, generics, acute infusion growth and strong commercial execution in both the Specialty and Infusion businesses.

Home and Community Pharmacy revenue was $540 million, representing a decline of 8% year-over-year due to an approximate $50 million impact from the IRA, along with our decision to exit some uneconomic customers, both of which we have previously discussed and performed as expected. On the IRA impact for the balance of the year, we continue to see a revenue impact at Home and Community Pharmacy of approximately $45 million in each of the remaining quarters in 2026, bringing the total year IRA impact to Home and Community pharmacy revenue of approximately $200 million.

In the Provider Services segment, we reported revenue of $466 million, which represents 30% growth compared to the prior year. Home Health Care reported $278 million in revenue, growing 51% versus last year. Revenue performance was driven by average daily census growth, de novo expansions and the impact of the acquired Amedisys and LHC branches, which contributed approximately $78 million of revenue and approximately $8 million of adjusted EBITDA in the second quarter.

Rehab Care revenue was $82 million, growing 12% versus last year, with healthy growth in persons served and hours billed in core neuro rehab, along with the continued momentum in our rehab and motion program. Personal Care revenue was $107 million, representing 7% growth year-over-year, driven by modest growth in persons served, strong growth in hours billed and stable operations.

Moving down the P&L., second quarter company gross profit was $493 million, representing growth of 32% compared with the second quarter of last year. Adjusted EBITDA for the total company was $206 million in the second quarter, an increase of 44% compared to the second quarter of 2025. Adjusted EPS for the total company was $0.45.

Company profitability benefited from strong top line performance across the businesses as well as consistent operational execution in addition to and from investments related to technology and AI. We continue to make targeted investments, supporting a variety of operational processes and programs that will improve procurement efficiencies, streamline operations and further standardize best practices throughout the organization.

Turning to segment profitability performance in the second quarter. Pharmacy Solutions gross profit was $298 million, growing 28% compared with the second quarter of last year. Adjusted EBITDA for Pharmacy Solutions was $180 million for the second quarter, an increase of 44% compared to last year, representing an adjusted EBITDA margin of 5.3%, which increased approximately 80 basis points versus last year and was similar to the first quarter of 2026.

Second quarter Pharmacy profitability benefited from strong branded LDD portfolio performance, product mix across all Pharmacy businesses, pharma services and hub revenue and gross profit as well as continued investment to improve operational performance. Of note, notwithstanding external IRA and any payer impacts, Home and Community Pharmacy EBITDA performed well year-over-year in the quarter due to our internal continued operational process improvement underpinned by the deployment of new technologies.

Provider Services gross profit was $195 million, growing 38% versus the second quarter of last year, with adjusted EBITDA of $75 million, growing 33% versus last year. This represents an adjusted EBITDA margin of 16.1%, up approximately 30 basis points compared to last year. We have continued to see the benefits of operational initiatives that we have put in place over the past year, driving broad-based growth, greater efficiency and economies of scale and increased margins across our Provider Services lines.

On a total company basis, cash flow from operations was $44 million in the second quarter. Excluding the onetime cash payment for taxes of approximately $100 million related to the Community Living transaction, cash flow from operations was $144 million. Recall that the discontinued operations cash flows are included in the consolidated company cash flows. As we look forward to the balance of the year, excluding Community Living related cash flow impact, we expect to deliver approximately $600 million of annual operating cash flow.

As of June 30, net debt outstanding was approximately $1.7 billion, and we finished the quarter with a leverage ratio of 2.15x, which includes the impact of approximately $100 million of taxes associated with the Community Living divestiture in the quarter. As mentioned during the Q1 2026 earnings call, our leverage at Q1 when adjusting for the Community Living taxes that were due subsequent to quarter-end was a leverage of 2.4x. We were able to reduce our leverage from Q1 2026 to Q2 2026 on an adjusted basis by 0.25x. Our leverage ratio also includes $120 million of share repurchases year-to-date.

During the second quarter, we've repaid approximately $300 million of the term loan with proceeds from the Community Living sales and repriced the loan at SOFR plus 200. This compares with SOFR plus 325 at the time of our IPO and reflects strong operating performance of the business, improved cash flow generation and our lower leverage position of the company since the IPO.

During Q2, Moody's and S&P both upgraded BrightSpring's credit rating, better reflecting our leverage position and debt management philosophy. Moody's upgraded its rating to Ba3 from B1, and our senior secured first-lien revolving credit facility and senior secured first-lien Term Loan B ratings to Ba3 from B1. S&P upgraded our issuer credit rating to BB- from B+ and also upgraded the ratings on our revolving credit facility and first-lien term loans to BB- from B+.

The company has evolved since going public in January 2024, with business mix, scale, operating performance and leverage all further improved. As we move into the second half of the year and 2027, we will continue to evaluate options for the most appropriate capital structure needed to support growth over the next 5 years.

Turning to guidance for 2026, which excludes Community Living business as well as any acquisitions that have not yet closed. Total revenue is expected to be in the range of $15.1 billion to $15.425 billion, including Pharmacy Solutions revenue of $13.2 billion to $13.5 billion and Provider Services revenue of $1.9 billion to $1.925 billion. This range reflects 17.0% to 19.5% growth over full year 2025, excluding Community Living in both years.

Total adjusted EBITDA is now expected to be in the range of $820 million to $845 million for full year 2026. This would reflect 32.8% to 36.8% growth over full year 2025, excluding Community Living in both years. Included in total adjusted EBITDA is expected contribution from the Amedisys and LHC assets acquisitions of approximately $35 million.

I will now turn it back to Jon.

Thanks, Jen, and thank you for your time today to go through BrightSpring's second quarter 2026 results. We will now open up the call for questions. Operator?

[Operator Instructions] Our first question comes from the line of Charles Rhyee of TD Cowen.

Congrats on the quarter. I just wanted to ask maybe what you're seeing in terms of generics. There's a lot of discussion the other day about Revlimid. And I think you guys had said previously that that was kind of coming on in stages. Just curious, maybe sort of the contribution you saw in the quarter from that? And maybe just give us an update on what you're seeing, how we should be thinking about layering in the benefit as we look to the rest of '26.

And then maybe, Jen, just real quick, any comments on sort of the step-up in corporate expense in the quarter.

Charles, I'm not entirely familiar with any news on Revlimid lately, but that's already gone generic about 4 years ago. It's been fully generic for quite a while now. So there's really been no change whatsoever to our expectations this year.

Yes. From a corporate standpoint, Charles, we did see an increase as we continue to increase some investments across key hires, including some key hires we have in a couple of different business roles as well as corporate leaders that we're really excited about that are going to help drive value. We also did continue to invest in AI and automation technology projects throughout the quarter. And we'll be looking for the benefit of those to come on either later in the year or very early next year.

Our next question comes from the line of Ann Hynes of Mizuho.

I just want to focus on gross margin in the Pharmacy segment. It was up year-over-year 40 basis points, but it was down sequentially 70 basis points. And when I look historically, gross margin is usually flat Q1 to Q2. Can you just tell us what's going on?

Yes, Ann, the margins in Q2 were very healthy again and completely in line with our expectations. We had seasonality in Q1 of this year, which is very typical, and typical for your gross margin to be a little bit higher in Q1 versus Q2 for a variety of reasons. And on a GP per script basis, actually, when you normalize for that, our GP per script was actually up in Q2.

So I would just reiterate that in the business, year-over-year growth was still 28% in GP, higher than revenue growth. And Specialty script growth, in particular, was 32% year-over-year and even 15% up sequentially.

Our next question comes from the line of Scott Fidel of Goldman Sachs.

Would be interested if you can maybe parse out in the Infusion business, maybe talk about how growth in the chronic versus acute segments looked in terms of you can call out year-over-year or sequentially. And then maybe just talk about in terms of the continued sort of investment and buildout in the chronic infusion side of the business, in terms of momentum there, in terms of manufacturing engagement or demand or any other milestones you want to call out.

Yes, Scott. I mean, look, we continue to be really positive on the Infusion market, notwithstanding some things here and there. It's a $20 billion market, still pretty fragmented, less competitive on the acute side for a variety of reasons just given the demands, service delivery requirements there. But within that market, I can say that our achieved volume year-over-year was up over 20%, which is what some 7 to 8x what that market grows at. So some of our investments really pay off. And I think as we sit here today, there's another 12 to 15 states that we want to be in over the next 5 years. So we really view Infusion as a long-term play here where we can continue to grind away.

On the chronic side, we're still making progress, nowhere near where we want to be. Nevertheless, the volume growth on that side of the business year-over-year was close to 20%. We've done some things like roll out white glove concierge programs for things like IG. We've seen that increase our conversion rate noticeably in the quarter. We're going to do that on some other target therapies.

And we just continue to invest and add into the business in terms of capabilities and infrastructure. We've got a key AI project going on, on the intake side. We've made some key hires, upgraded CFO of business within the last quarter, some commercial investments as well, brought in new leadership from a data analytics standpoint. And we're starting to put this business together from a payer and purchasing standpoint in a more integrated way with our Pharmacy for America business and all of that scale over there. So we see a lot of benefits from that in the future as well.

So it's been a really productive quarter in that business, but remain, I would say, more enthusiastic from a long-term perspective.

Our next question comes from the line of Pito Chickering of Deutsche Bank.

Can you talk about the ramp of the LDDs in the back half of the year and how to think about the contribution of revenue and EBITDA? Any color if you'll be involved in direct [indiscernible] launches in the fall? And how should we think about the overall EBITDA seasonality in 3Q and 4Q?

Yes. I'll let Jen handle some of this. But Pito, we remain really enthusiastic about that business just given we've already won 12 LDDs to date this year, as mentioned in the script. Not only are we continuing to try to be the best oncology partner we can be within, I think, one of the more dynamic and innovative spaces within the specialty market. We're really leveraging those capabilities as much as we can, not only from an operational, but from a commercial perspective and field perspective to extend our partnerships outside of oncology. And we have a lot of those today and some of our most, I would say, exciting wins here going forward have actually been outside of oncology now.

So we're not at liberty to talk about any specific drugs, but we're well aware of the situation you referenced. And again, I think we're always leveraging our unique operational capabilities and our customer satisfaction feedback and our value-add wraparound services for manufacturers, which include patient contact centers, nursing services, 3PL, data analytics agreements and capabilities. We just continue to lean into those as much as we can and leverage our track record to put ourselves in a great position to continue to be a partnership to partner for a lot of these just incredible therapies that are in the pipeline. So optimistic about it as well. And the year is playing out as planned, if not a little bit better than planned, and we couldn't be more enthusiastic about the future.

Yes. The only thing I would add, Pito, in terms of growth through each quarter of 2026 and our guidance, we have delivered a very strong first half, $206 million in the quarter. We expect quarter-over-quarter growth continuing for the rest and the balance of 2026. We do expect that growth quarter-over-quarter be very similar. So Q2 going to Q3, Q3 going to Q4, we expect continued growth and that to be very similar to -- in Q3 and Q4's growth to be similar to each other.

Yes. I mean last year, second half, for a variety of reasons and catalysts, was a really huge second half, and we're going to be lapping that. But we still expect robust year-over-year growth. I mean if you look at the first half versus the -- our guidance and the high end of the guidance, that obviously implies pretty good continued growth throughout the year.

Our next question comes from the line of Stephen Baxter of Wells Fargo.

I was hoping to get an update on pharmacy sourcing initiatives as you continue to build scale. And then relatedly, we saw some headlines recently about the potential for generic tariffs starting in a couple of years. So how are you thinking about the potential impact of that? And how do you build contingencies for that into your contracting?

Yes. I would just say from a purchasing perspective, that's something that we've had a focus on for a decade now. If you look at our value proposition as home and community health care company targeting what we believe to be the most attractive markets and those of highest need and then just leveraging our scale in our operating and commercial capabilities, that scale component has been a focus for us for a really long time.

And so we continue to do what we can there. And I think what we've done more and more over time that we're continuing to do is to really try to be one face to a lot of our external partners to be able to leverage that scale as much as we can. And we'll continue to do that.

From a tariff perspective, there continues to be a lot of noise, but nothing that has impacted the company to date. We're pleased that the Trump administration has pushed any potential tariffs on generics to 2028. We continue to be flexible, as Jon mentioned, in our purchasing contracts. There's a lot of opportunities to buy drugs from different locations. We continue to monitor that closely, and we'll obviously continue to exercise good judgment as best we can as we approach any tariff impact that there could be.

Look, I mean, the good news is like generics are obviously a lot lower cost, right? And so for that reason, as we kind of look across our business and take a view of it, when you look at the product by product business by business, that's not something that has us concerned as we think about our long-term growth algorithm and adding up all the different growth pieces that are going to go into it over the years. We don't view that as something that's worrisome.

Our next question comes from the line of A.J. Rice of UBS.

I'm just interested maybe in pursuing a little more Jen's comments in the prepared remarks that you were looking at options for evaluating what the optimal capital structure is for the company going forward. I know you've gotten rid of -- or gotten the proceeds in now from Community Living divestiture. Are you thinking maybe you can lean into acquisitions a little more? Maybe give us a little flavor of what you're seeing in terms of the pipeline as well. Or is there something else you're looking at in terms of commenting on optimal capital structure?

Yes, A.J., thank you so much, we appreciate the question. We're really proud of the work that we've done from a balance sheet perspective, with our leverage at 2.15x at the end of this quarter. We really are excited about the position that puts us in. As Jon mentioned in the call, I mentioned in the call, we have -- we were able to reduce our interest expense. We continue to look at what makes sense from a capital structure perspective, especially with the ratings upgrades and what makes sense there. We do believe that we will continue to be able to lean in on M&A, and we have a very robust pipeline. As Jon has mentioned, that continues to be very robust. And we're excited about the back half of 2026 and into 2027 that the balance sheet position has really given us a lot of flexibility from a capital standpoint.

A.J., I would just add, we're actually thinking about adding to that M&A team. I mean we've got 7 people on the team already, they do a great job. But really the hallmark of our M&A approach over the last 10 years now has been really targeting tuck-ins and geographically adjacent areas where we can apply better operational capabilities and synergies to drive a lot of accretive deals.

So we operate in massive markets. Some of our markets don't really have acquisition opportunities. But you look at Home Health, Hospice, Rehab, Infusion, Primary Care, Home and Community Pharmacy, those all do. And so the ability to be the scale provider across these markets and leverage all of our scale, synergies and operational capabilities is just a really big value proposition.

So I think that's something that, particularly from a smaller tuck-in perspective, we'll probably look to even increase the frequency on. And in terms of medium to a little bit bigger-size deals, and for us, bigger is still always probably less than $40 million of EBITDA, that pipeline continues to be huge and long. And we continue to get people who proactively approach us who really want to be a part of our enterprise as a long-term home.

But some people out there always do and are increasingly doing goofy things on prices and valuations in some of these markets that go well into the 20x EBITDA. So we just stay incredibly disciplined. We pick our spots. And we've got our hit list right now and we'll see if they work out or not. But it's always got to meet our criteria, and we always try to make everything work in the equation and stay pretty disciplined.

But great to see where the balance sheet has evolved. And I mean, we'll do over $600 million of OCF this year. The free cash flow is not going to be far behind it. And I think we're just really pleased with how that's played out over time.

Our next question comes from the line of David Larsen of BTIG.

Can you talk a bit about your selling efforts like and how they've evolved? So if you're talking to an acute care IDN, what is the sort of the value prop to those hospital systems, how much time do you spend selling to the actual health plans? Are they encouraging their networks to work -- like work with you? And then how many reps do you have, like commission-based reps really, if any, just how that has evolved over time?

Yes. I mean, I just think fundamentally, our value proposition is to be a leading partner where we can deliver, hopefully, some of the highest-quality services to payers and to hospital systems and to ACOs, to everybody, and really help, in particular, in those first 30 to 60 days post-discharge to reduce unnecessary bounce-backs and in-ER visits. And that's what we've been really focused on for years.

And so our ability to be a preferred provider in a narrower network with ACOs, with some hospital systems, with payers, we've seen the ability to execute on those agreements here over the last couple of years. And it will remain a really key focus for us. I think in part, that is one reason why we're seeing growth rates well above the industry averages here.

I mean even on the Provider side, David, while the business grew over 30% all in from an EBITDA perspective year-over-year, I mean, organically, we were just a touch under 20% on the Provider side organically. But I think that's at play. It starts with our quality. But then you've got to be a great partner, Johnny-on-the-spot service all day long with thousands and thousands of referral sources and hundreds of thousands of patients on a daily basis. So we have a lot of individual clinical liaisons across our service lines that are in doctor offices and hospital systems every day. I mean it's -- if you look across the breadth of the company, it's probably near 1,000 clinical liaisons across our service lines just doing great educational and support work every day.

So I think our ability to more formalize post discharge programs and enter into even more preferred agreements with individuals, there's only more and more opportunity and a lot of opportunity to do that, but building on some of the things we already have done in that area, which has been a part of our volume growth.

Our next question comes from the line of Sean Dodge of BMO Capital Markets.

In Pharmacy, the IRA headwinds this year, Jen, you said $200 million now to Home and Community. And I think you said before, $175 million to Specialty and Infusion. Is that still what you're expecting for Specialty? And then is it too early to tell, or are there kind of any directional indicators you can give us on the impact either in aggregate or by subsegment there what the impact from the next round next year will be?

Yes. So IRA for Home and Community is just a touch higher than where we were based on our sale of the drugs this year. So it's about $200 million that we expect for the balance of the year, so -- or not the balance of the year, for the full year. About $50 million worth of impact in each quarter. The EBITDA impact remains about the same as we had previously expected and stated, which is $15 million for the year. That's for Home and Community.

IRA impact in Specialty, just as a reminder, from an EBITDA standpoint, is really nothing, but from a revenue headwind standpoint, does remain around that $175 million for the year.

We try to get well ahead of this from an operational perspective, and a lot of the things we've done on technology and automation and AI last year and now this year are going to play out into next year as well. So now that IRA thing needs to get fixed. It's still broken in its approach and how it was applied to the industry. But we're doing everything we can from an internal perspective to control what we can control. And the team's operational execution this year has just been phenomenal. And we're seeing that play out in the business and it will continue to play out next year, and makes us optimistic about the prospects for that business this year.

I mean it's going to have an up second half, had an up second quarter, and there are some good drivers there for next year from an operational perspective, and in a lot of these growth markets that we're in, like ALF and behavioral. So unfortunate that we have to deal with some of these unintended consequences and things that occur on some of these legislative items, but we continue to work our way through it.

Yes. And just to your question on 2027, the drugs, they selected the large drugs first. As I think about 2027 impact really from a Home and Community standpoint, it's about 50% of the impact that we had in 2026 is our best view. And obviously, we continue to work, as Jon mentioned, from a regulatory standpoint, and then also on payer contracting to mitigate the impact for 2027, in addition to the work that we're doing operationally.

Our next question comes from the line of Joanna Gajuk of Bank of America.

If I may, a follow-up question on the question around the gross profits in the Pharmacy segment. So like you said, the gross profit per script was up 28% or so year-over-year. But I guess sequentially, it did decline slightly, right? So is that a new sort of number, the [indiscernible] call it gross profit per script as a good number to think about going forward? Is there more, I guess, growth that we should assume for that metric going forward? And kind of remind us the main drivers. Specifically, if there's a way for you to help us or understand the impact of the fee-for-service revenue adding to that metric as well.

Yes, Joanna. I mean, I would just -- I would just take a step back and just sort of as we think about the broad growth of the company, really pleased across the board with what we've done, not only on the Pharmacy side, but then you look at the Provider side, 44% and 30%. So we always think about the company just from a total growth perspective and go from there with all the different pieces in the organization.

Within Specialty and Infusion, a lot of different levers there and a lot of different moving pieces that all contributed to the quarter. As you said there at the end, fee-for-service is certainly one of them. We've really focused on having best-in-class wraparound services to support our manufacturing and biotech partners and all of their patients, and 5 or 6 different dimensions of what we offer them from a partnership perspective. So that capability set and the volume of patients we're serving and the amount of manufacturers we're serving with those wraparound value drivers does continue to increase at a very healthy clip.

But it very was multifaceted growth, not only across the enterprise, but within Specialty and Infusion. And you had the acute business in Infusion doing really well. The chronic business is growing there. Operational efficiencies. We've actually won 5 LDDs in infusion in the past 6 months, too. So we're turning our focus from an LDD perspective, leveraging our know-how on that side in the oncology world to Infusion too. And then you look within Specialty and the 12 LDD launches this year, 8 networks, 2 for exclusives, you've got the fee-for-service, you've got OpEx per script leverage and you've got continued partnership as we help drive generic conversions as they come out. So there's a lot there and we're always focused on a lot of different growth levers.

GP per script in the quarter was up sequentially when you adjust for some typical seasonality and some items that occur in Q1. As we look to the rest of the year, we think that is a pretty stable level. But everything is within our expectations right now fully. And as we think about the rest of the year and next year, nothing has been outside of what we would have expected whatsoever.

Our next question comes from the line of Whit Mayo of Leerink Partners.

Jon, you've talked about acute infusion as being an area of focus for the organization. I was just wondering if any of the potential 340B changes sort of impact your views on that.

Whit, no, that is not a meaningful part of our Infusion business.

Our next question comes from the line of Raj Kumar of Stephens.

Maybe kind of going back to the generic conversion component of the growth here, and as you kind of think about 2027 and that pipeline, maybe any way of framing what that -- what the branded versions of those drugs make up in the kind of current script that you're seeing year-to-date as we try to kind of frame the opportunity for 2027?

Yes. The launches that we -- the brands going generic that we see in 2027 will probably happen later in the year, which would be our expectation right now.

Our next question comes from the line of Matthew Gillmor of KeyBanc.

I wonder if you could frame up the rare and orphan opportunity relative to oncology. And then can you help us think through any sort of augmentation or investments into the sales force that needs to go along with that? Or does that leverage the existing sales force within Specialty Pharmacy?

Yes. On the latter, you're exactly right. And I think that's something that's really interesting to us. We've got several hundred folks that are clinically liaisons working across thousands of prescriber offices today. I think some other niche companies that have only focused on rare and orphan in the past don't have a sales force. So we see the -- and then we've got 155 LDD programs and 15 years of experience in that area.

But I mean, there -- it's not 1 or 2 therapies that we're supporting outside of oncology. It's quite a few. And we've had some really noteworthy wins there here in the last 6 months, which has been terrific to see. And it's been based on the long track record that we could point to across our history of other LDDs. So we can 100% service almost any other therapy outside of oncology within the world that you referenced. And that's why that's an obvious area of strategic growth for us.

But that market is sizable. I don't think it's nearly as sizable as oncology, but it is sizable. And it's -- we wouldn't be spending time on it if we didn't think it could be a meaningful contributor in the future. It's nowhere near as big as oncology, but it is an interesting market.

Our next question comes from the line of Jared Haase of William Blair.

Maybe I'll drill back to your comments about seeing retention at all-time highs in the Home and Community business. I'm curious, would you sort of primarily attribute that to some of the technology initiatives that you guys have put in place? Or is there anything else that you would call out driving that retention? And I guess, how much more incremental opportunity do you need to push retention higher as sort of another growth lever going forward?

Yes, Jared, I really appreciate that question. So that's been an area of focus for a really long time. I mean it's really fundamentally 3 things. We continue to invest in our individuals from a compensation and benefits perspective. And that's been a continued focus for us, and we've been able to do that within our financial performance here for a really long time. We want to attract really good talent and the best talent. And so I think we've really tried to reward our people as best we can.

I would say, to your point, exactly number 2 on technology and process, how do you try to make the job as efficient as possible for people so they don't have headaches? We try to be really innovative with our approaches there and lean in to make -- to give them every ability to focus on the patient as much as they can versus some of the headaches administratively and with paper work that you might face. So that's been a huge area of focus for us, and we continue to do that.

I would say just really third, from a training perspective, it's a huge investment for us. We try to make sure the onboarding experience is as seemly as possible, and people get trained and they're invested in from a talent perspective and a development perspective to -- with all sorts of programs in the company where people can graduate through it and move up and be advanced in their career at the organization. So people and talent management is kind of a passion for us here. And the bigger we get, we just try to invest more and more in that if we can.

And then culturally, we just try to be a good place to work. We focus on the mission every day. We try to reward people and try to create a very mission-focused culture where everybody is really respectful of what we're trying to do here and each other. And I think it's a place people like to work.

Our next question comes from the line of Erin Wright of Morgan Stanley.

So I want to go back to gross profit per script. It was up 28% in the second quarter, 50% in the first quarter, 21% in 2025. But before that, it was like roughly flat. So can you give us a little bit of a context of what led to the inflection and some of those durable overarching drivers there as we kind of head into 2027 as well?

And somewhat of a related question, can you speak to hub services particularly, like in terms of how big it is, how much of a driver that is for you, how important that is to growth? Can you remind us of how some of those fee-for-service relationships work?

Yes. I would say just any changes in our gross profit margin are always a function of mix in every one of our businesses. And as we've layered on more fee-for-service business, really those services are offered in every one of our launches. And so that's something that we're seeing consistently now, is when we come to market with a new drug, there's a lot of other services that we have to offer to our partners for real-time visibility and optimal patient outcomes.

And so it's not the majority, certainly, of our profitability in the business. But I would say it has become a meaningful, probably top 4, top 3 contributor to margin in the business.

Our next question comes from the line of Brian Tanquilut of Jefferies.

Congrats on the quarter. Jon, maybe as we think about some of these bigger oncology or oral oncologics that are coming down the pipeline, how do we think about the dynamics of those shifting or going down to LDD pipe, and as we think through exclusive agreement versus really ultra-narrow networks?

And then maybe, Jen, just related to that question, from a margin perspective, just curious how to think through the differences between those 2, like exclusives and ultra-narrow and how that ramps over time?

Yes, sure. I mean, Brian, I mean I just would agree with your point that we're very enthusiastic about the pipeline within oncology. There's a lot of innovation that obviously continues to go on there, and we've tried to position ourselves as the partner of choice in that market for a long time.

Yes. And I would just add, from a margin perspective, we typically are negotiating with payers on a basket of LDDs, which includes exclusive and ultra-narrow. So certainly, having exclusives and ultra-narrows has been a differentiator for us and our ability to negotiate rate on those drugs.

Our next question comes from the line of Parker Snure of Raymond James.

So just piggybacking off a previous question on the sales force in Pharmacy. If I look at the G&A in Pharmacy business, it stepped down in the second quarter about $13 million to $14 million from the first quarter. Just curious on the drivers there. Was there any timing of certain investments or anything else you'd call out? And just how should we expect that line item to track going forward?

Yes. So we did have some specific onetime investments in the first quarter that we had a mix of both ongoing investments, we talked about that last quarter, sales force and other key positions as we've been layering out our management team to support future growth. We did have some AI projects and some other automation work that that spend wrapped up in the first quarter. We continue to have other projects and spend, some of which is in our corporate spend in the second quarter.

Our next question comes from the line of Jason Cassorla of Guggenheim.

Great. Maybe just on the Amedisys and LHC assets, you upped the EBITDA expectation there for about $5 million, which isn't significant for the enterprise, but it's almost an incremental 20% step-up in EBITDA for those assets specifically. So I guess, just can you walk through the drivers there beyond just perhaps the pricing benefits of hopping onto your platform? I guess, just any help there would be great.

The integration in that business has continued to go really well. As we started off the year from a guidance perspective, we had planned for a slower ramp on some of the growth initiatives that we would have just to make sure that the team had the time that they needed in order to really be able to do the integration work that we had going on. Some of the investments that we needed to make, so Q1 to Q2, we talked last quarter about some investments, all of -- as of today, all of our business lines are -- and branches are now on our Home Care, home-based system. We're working through the final steps of integration, and we just feel more confident about the ability to increase that guidance.

Integration has gone extremely well and the volume is moving up under our ownership now.

Thank you. I would now like to turn the conference back to Jon Rousseau for closing remarks.

Thank you, everybody, for joining today. We really appreciate your time on the call. And it was a productive quarter. I think as well, we just continue to really invest for the future at the same time as delivering on today. And we look forward to talking with you in another 90 days. Thank you, and have a great day.

This concludes today's conference call. Thank you for participating. You may now disconnect.

Okay. Well, we're ready to get started with our next panel. I'm Scott Fidel. I'm the health care services analyst with Goldman Sachs.

Really delighted to have BrightSpring Health Services with us today. Here from the company, we've got Jennifer Phipps. Jen is the Chief Financial Officer; and then David Deuchler as well is in the audience with Investor Relations.

So Jen, first of all, welcome to the conference.

Yes.

It's great to have you, and BrightSpring, here. And also, personally, it's just great timing for us because we actually just initiated research coverage on the company on Sunday night. And that's really exciting to me covering the company. I've been monitoring the company's progress since the IPO and have definitely been quite impressed with the performance the company has delivered against some end markets where it's not necessarily a given that everything is going to be linear. So looking forward to covering the company on the forward.

So I think, Jen, maybe let's just sort of start -- let's sort of start with the growth profile and start with sort of a little bit of a look back over the last couple of years, like I just mentioned. And the company is -- like we had in our note, one of the headlines was the growth profile is hard to ignore, in terms of what you've delivered. And over the last few years, that's meant 20% top line growth, 25% to 30% EBITDA growth, which is well ahead of the mid-teens framework that you have historically referenced. So why don't we sort of take a look back and sort of give us some insight into where those outperformance levers have been driven from when we think about LDD cadence, share gains, operational initiatives, just in terms of giving us sort of insight into what the underlying sort of drivers of performance have been?

Yes, Scott. Thanks for having us. Obviously, we're glad to be here today. BrightSpring has operated traditionally in really attractive markets that are growing at attractive rates, providing higher ROI services to the network. And so as we think about that, we've been leaders in the market across both pharmacy and provider. We've had broad-based growth across all of our businesses. We have had -- we've been able to leverage our scale, leverage our investments in our M&A platform, which has helped deliver on the growth that we've had over the last few years.

As we look across all of our businesses, we've seen really good growth across all of our businesses. Our specialty pharmacy business has grown higher than our company average. And as we think about that growth rate, that has been underpinned by our high-quality services and volume that we've been able to drive, largely because we've won new LDDs. We've won 16 to 20 LDDs each of the last several years. As we think about that going forward, there's really strong continued markets in both the oncology and rare and orphan, which is where we traditionally have focused our specialty pharmacy growth.

So as we look at that profile -- and a lot of times, those LDDs typically take 2 to 3 years to grow in the market. So our 2026 growth from a revenue standpoint is partly underpinned by LDD wins that we had back in 2024. We have seen, again, that broad-based growth across pharmacy and provider, which I think has really been beneficial. We've been able to leverage our scale, which has allowed us additional operational efficiencies and improvements. That's really at the core of who we are. We've been talking about that since the IPO.

But really, if you go back 10 years, you'd see a list of projects that we are going after every single year. In the 12 months, we've really operationalized and formalized our Lean Six Sigma training and processes, embedding that throughout the operations as well as focused teams at our corporate that are helping deliver on some of those growth.

All right. Great. So why don't we sort of take that and we'll just sort of transfer it forward. And timing is good to talk about the forward. You had your investor conference not too long ago at which you laid out a framework for a 15% to 20% growth algorithm from that '26 to '28 time frame. Maybe sort of similarly, maybe talk about sort of as you laid out that model, some of the key variables, the key inputs that you think could -- to push that towards the top end versus the bottom of the range? And particularly a few of the things that I'd love to hear from you about would be those sort of that continuation of the LDD wins, which has been, I think, such a unique competitive differentiator for the company recently, then the infusion ramp and then provider growth as well.

Yes. No. I think underpinning really that entire growth rate is our expectations for continuing really strong volume growth, which is underpinned by our high-quality services. So as we think about each of our different business lines, those markets are highly attractive markets that are growing. And then we've been able to grow in those markets via expansion into new geographies as well as deepening in those markets and market share that we've been able to take. We expect that to continue across our different businesses.

As we think about -- you asked specifically about LDDs, we do see -- we provided an outlook. We typically are working with manufacturers what can be 12 to 18 months in advance of launch. So we have oftentimes pretty good visibility pretty far out. And as I mentioned, '27's growth will be underpinned by the 2024 class of launches or the 2025 class of launches, which we've already launched. So continuing on that LDD growth and what we win in '26 will deliver meaningful opportunities in '27.

So we have pretty good visibility, again, 12-plus months out from a launch, as well as what we've launched, which helps us give confidence in that framework. We think that these are really strong markets. So as you think about the pipeline of products coming out that are in the Phase III trials, both in oncology and the rare and orphan space, which is where we target those opportunities, we see very strong pipelines. And we continue to see those pipelines execute on these more narrow networks than they traditionally had what might have been 5 or 10 years ago.

So we've seen that continuing narrowing. We continue to see that over the next several years as we're working with manufacturers on the potential launch of their products and understand what that market looks like.

Again, it's really important to continue to win those, that we deliver on those high-quality services. So we're one of the highest-quality providers in this space with time to first fill, medication possession ratio, which is like an adherence measure, that is allowing us, and a strong sales force that is pulling through scripts volume, and ultimately developing really strong relationships with pharma to have white-glove processes and information and services around the launch of their new drugs, which we think is very beneficial.

From operational efficiencies, we continue to see opportunities across especially technology as we leverage into more manual processes like front-end, central intake or revenue cycle. We see opportunities across a few different areas.

Home infusion, as you mentioned, is an area we've been investing in over the last couple of years. That is a smaller piece of our pharmacy business, but we really see the value of infusion, and we do think that that is a big opportunity for growth. So we'll be focused on -- we really have about 35 pharmacies across the United States. And there's additional areas that we need a presence in from an acute standpoint. So there's geographical expansion, but also deepening in the markets where we are.

And then finally, you asked about the provider side. So we operate in what we call home health care, which is home health, hospice and primary care. We see that as being just a really important opportunity to leverage across our pharmacy network and continue to deepen relationships as well as growing in those markets. And then on the rehab side, that is a strong growth market. Personal care is really more of a steady state, small grower for us, but really important value that it's delivering from an activity of daily living that's supportive care that is very beneficial to patients.

So certainly, as we think about the next step of -- and Jon has really talked about, obviously, our growth being core and strategic, and then highly accretive M&A. And as you think about the core growth, each of our businesses, having focused growth strategies and plans and operational teams that are focused on growing in each of their individual end markets. From a strategic growth standpoint, how can we better unlock referral opportunities and integrated care opportunities across our platform? And that is definitely something that we're going to -- that we think is of value and will be able to be valuable to us in the next 2 to 5 years. And then obviously, highly accretive M&A.

Great. Wow, there was a lot in there. One quick question, just on the acute care infusion expansion that you mentioned. And you said you were at 35 sites currently?

Pharmacies? Yes.

Yes. So 35 pharmacies. Do you have any visualizing of like where you think that number can grow to over the next 2 to 3 years?

It's a good question. Obviously, this is an area that we do have some interest potentially in M&A. We're certainly thinking about the buy versus build. As we think -- there's definitely 5 to 10 markets that we laid out -- I don't think we actually laid out the markets, but we talked about 5 to 10 markets that we would be interested in expanding into over the next handful of years, at the Investor Day, in our infusion area. So as we think about some key areas where there's infusion opportunities where we don't deliver into as much, we see that probably in about 10 to 15 markets.

Sounds like a good place to see and find out and do a little research on and maybe sort of get some insights there. Great. Well, you ended with sort of talking about -- we sort of talked about all the different pieces: the pharmacy, the provider model. And let's maybe bring it back up, I know we like went straight to growth and which I always want to do and straight to the numbers, let's sort of bring it back up to the business model itself.

And in particular, give us some real insight into when you talk about that adding value by having both the pharmacy and the provider business, what that really sort of translates to, what that really means in terms of whether it's synergies on the revenue side, synergies on the expense side. Because we always hear a lot about that. And then there's like there's having the businesses and then there's having them truly integrated, right, and creating value. And sort of let us know what's new with that sort of integrated value creation.

Yes. So we've talked about sort of our one company model as delivering a number of different value areas. So the first is we're serving very similar patients across both our pharmacy and our provider needs. So if you look at the needs of the patients that we're serving, they often have multi-chronic, they're the most expensive individuals in health care. They have 6 or more -- our patients typically have 6 or more chronic conditions. They all need pharmacy. Most of them at various points in time will need provider services, whether it's rehab, home health or hospice services. And they all have a primary care physician need.

And so as we think about how can we provide more of those services to the patient, which just, I guess, would be, as you think about that core growth, how do we just leverage patients that are receiving one area of -- whether it's pharmacy or provider services, how do we better leverage that patient across multiple services, maybe core growth. But then as we think about the connected nature of their needs, and how do you provide even better outcomes?

So in late 2023, we had an article published in JAMDA that showed a 72% hospitalization reduction for our patients that receive our home health along with our pharmacy in the home, [ hospice ] and -- versus home health on average, so an average home health hospitalization patient.

I mean, 72% reduction, that is very statistically meaningful. And we do think that there is a lot of -- there's improved outcomes when you receive more coordinated care. And so we are very interested in how can we have better payment models across -- in addition to just additional core growth, how can we unlock better payment models potentially for the outcomes that we're producing, whether that's happening in an individual business line.

So for example, in home health, we had a couple of new contracts in the last 12 months where, on the MA side, where we're getting enhanced rates for outcomes. So the core -- they wanted us to serve more and so we were producing the outcomes. And so with those outcomes, we're getting enhanced rates. That is a version of sort of a value-based care, I guess, enhancement.

Scale is critically important. So whether it's scale on the payer side from a -- on the reimbursement side or scale on the cost side, how can we better leverage our scale to drive value and economics that allow us, whether it's increased EBITDA growth or continued investment into our businesses, into our high-quality and compliance processes, that allow us to just -- or technologies that allow us to get better. Scale, that scale has allowed us to invest in targeted areas that we think are really attractive and to be able to target growth for 3 years from now or 5 years from now.

And then best practices deployment is critically important. So as we think about -- we think our home infusion business should be better in how they do nursing because we have home health and we do nursing there every day. And so how can we better connect best practices, whether it's in how do we target nursing from a -- in getting better nursing, or how do we make sure that they've got the right career pathing as an example. That's just one example, or IT, finance, the list could go on. But how do we leverage those best practices across our organization? And then really, finally, it allows us to invest in whether it's de novo or highly accretive M&A, that has allowed us to do -- to continue to grow as well.

Great. Two quick follow-up questions just sticking with this theme. So the first, just on some of those enhanced rate contracts that you said you're getting from payers and a big theme across the home health space in terms of needing essentially to get that, especially with how challenging the CMS reimbursement backdrop has been. Hopefully, maybe we're going to lap finally away from PDGM sort of payment. We'll see in the future. Any type of like insight you can give us in terms of how much of the gap between sort of traditionally discounted MA rates, which were as low as 25% lower historically than fee-for-service, how much of that gap you've been getting to sort of fill through some of these enhanced rate structures?

Yes. So the majority of what we do is episodic Medicare from a payer mix standpoint. But where we do MA, we are obviously looking to make sure that we're getting a fair and appropriate rate for the services that we are providing. And so some of the ways we've done that, as payers have come to us and asked us to take more of their patients, has been to be able to commit to quality because of our high-quality services that allows us to get an enhanced rate. So that's just an example of some things that we've done there.

We continue to have strong advocacy across many of our different areas. Home health certainly has become more important to us with the -- it's always been important to us, but it's been even more important with the Amedisys acquisition, Amedisys, LHC branches. And so our government relations team continues to advocate for fair and appropriate rates. We know that over 40% of people that get written for a home health script don't get it because of access. But we also believe, and believe that CMS and Congress understand the value of home health services and how it improves outcomes for the industry.

And then the other thing I'd be curious about is how BrightSpring, how the company has been evaluating what you think is the optimal clinical structure if you're going to look to try to integrate some of those different services into a particular patient in the home. So in terms of the home infusion services on one side, the home health services on the other. I'm just thinking back even to when we had -- Option Care had pursued the acquisition of Amedisys, and a lot of that thesis had been about sort of, I guess, really sort of integrating and elevating the home health nurse too to sort of oversee a lot of those sort of integrated services. And just curious around how you sort of envision that sort of clinical model as it relates to the actual clinician themselves, like how they can optimize the services.

Yes. So I think we think about our set of assets as being a little bit different than obviously that acquisition or that potential acquisition and that thesis. We're really focused on, first and foremost, core growth in each of our different business lines, which we think each of our different service lines have really attractive opportunities in markets where they can drive value individually.

And then separately, as we think about how do we better come together, that can come in different ways. So for example, how can our home health and our Part B rehab go to senior living communities and be a better partner and be a one-stop shop for those? And then how can we then potentially bring along our senior living pharmacy leaders in those relationships? Or vice versa, how do we leverage those relationships?

As you know, these are largely fee-for-service or episodic type relationships on the individual service line, and we see that being sort of the most important driver for each of those business lines. But how can we leverage the relationships we have to grow better in those core? And then as it relates to more integration of care, I think we see nurse practitioners in our primary care being sort of the quarterback of what is needed in the home for a patient, that potentially allows for additional opportunity.

Yes. That makes sense. That makes sense to me. Okay. Just a quick question on following the Community Living divestiture, maybe just talk about sort of the structural sort of change to that platform in terms of the growth profile and the margin trajectory.

Yes. So starting at the beginning of 2025, right after we announced the transaction, we started reporting the Community Living as discontinued operations. So from a continuing operations standpoint, throughout 2025 and any comparison period you would look at related to '24 and year '25 financials, you actually would not see Community Living in there at all.

One of the items though, that we did talk about early in '25 before it was removed, is Community Living was a lower growth profile business for us and it was also a slightly lower margin business. So if you were to look at '24 -- if you would look at it, including discontinued operations, I guess, I should say, because it's been reported outside of that, you would have seen a lower margin as well as a slightly lower growth profile business within provider. But what I'd say is that our financials, as people have read them, would have reflected that, frankly, since early 2025.

Okay. All right. That's helpful, certainly. Okay. So maybe let's talk about M&A, and it sounds like there's going to be at least some healthy optionality as you sort of look out over the next couple of years and sort of conversation has been around potentially up to $2 billion of sort of dry capital available for investor accretive opportunities. And that's exactly, I mean, as we publish our model, we certainly saw that visibility into it and certainly have that reflected in sort of the free cash flow production as well.

So the company has generally continued to focus on smaller tuck-ins, but now with leverage in the mid-2s, I mean, in our model, that comes down quite substantially over the next couple of years. So maybe sort of talk about how, I guess, the road map or the grid as we think about the tuck-ins across sort of your target markets and then how the criteria would maybe evolve towards thinking about something larger?

Yes. No, we really are proud of the work that we've done to deleverage and get ourselves to this position. We were at about 4.5x leverage post IPO, at 2.27x at the end of Q1, 2.4x if you pro forma it for the taxes we had to pay in Q2 on that transaction, under our long-term target, as you mentioned. And as we think about M&A, we agree. We think that there's opportunities for us to leverage really the M&A platform that we've built over the years to continue to do acquisitions.

I would say I would expect that we will be able to do the small tuck-in M&A that really we almost think of as light CapEx for us. They're highly accretive, really small tuck-in M&A. And I would expect that we'll continue to do that.

I think where we have the opportunity to lean in more, as we think about deals that we've not done many of the last couple of years as we've been focusing on deleverage, are deals in like, let's call it, the $3 million to $15 million worth of EBITDA range. I think there's opportunities for us to do maybe a little bit more of that, which is a little bit chunkier of an M&A, give us an opportunity as we think about expansion.

The areas most interesting to us are infusion within pharmacy, hospice and rehab within provider. And we will continue to have the same rigor and I would expect us to have the same process. Every deal we do has a strategic reason why we're doing it. We continue to be focused on what our growth rate looks like and the trajectory of our long-term growth rate. And so the deals that we do are going to be obviously important to making sure that we maintain that profile.

And so could there be a deal in a $30-ish million range, 1 or 2 of those in the next 5 years? Potentially. I think our capital flexibility definitely gives us that opportunity. But again, I think we're going to continue to have the same rigor and strategic rationale and process, led by our corporate development team, which is a very strong team, as well as our Integration Management Office, on any deals that we would do.

Great. Great. Time is flying by here. So I wanted to ask a couple of questions just on specialty pharmacy, which has really been the core engine for the company. 75% plus of EBITDA, it's continuing to grow at north of [Technical Difficulty] the end market itself, we have it sort of growing sort of that low to mid-teens type rate in the report. Your specialty business has been growing materially faster than that.

So why don't we just sort of start with those, the build around the growth? As we think about, clearly, we have the market growth, but then in terms of the market share and some of those particular strategies that we've already touched on, maybe talk about sort of how that layers into the outperformance we've seen and then hopefully continues into the future.

Yes. So I think our targeted strategy around LDDs has been very helpful in that. So you're right, it's been -- it's a market that's growing 10% to 15%. If you look at the -- but if you look at that, where we've been focused are on these limited distribution drugs that are going into narrow networks of 1, 2 or maybe 3 pharmacies, although we've typically seen 1 to 2 over the last few years.

This means that we're getting -- if it's a network of 2, it means that we would be aspiring to get more than 50% of the market of that drug. If it's a network of 3, it would be greater than 33%. So by layering on these new drugs where there are these limited networks, we're capturing a larger share of that growth just by nature of our LDD focus.

Great. And then sort of sticking with that, so you've guided to around 16 to 20 LDD launches over the next 12 to 18 months. How does that compare to the cadence that you've seen historically? And then also on the relative size of those launches.

Yes. So every drug is different in terms of the size of the launch and is an n of one. And so obviously, it depends on each drug. We've seen very large drugs, we've seen smaller drugs. But obviously, when it's in that LDD network, we certainly think those are attractive opportunities for us.

We have seen a narrowing of -- over the last few years, we've seen a narrowing of the networks where maybe 3, 4 years ago, there were 3 pharmacies, we're seeing a lot of times 2 pharmacies in these new LDDs. But each drug is different in terms of the market opportunity. We continue to see pharma going through these limited distribution channels. We don't see anything changing about that.

There's a lot of reasons why we think that's very beneficial to pharma working with a narrow set of pharmacies, and they've become increasingly comfortable. We believe they've become increasingly comfortable that a couple of pharmacies are able to service the entire market of that drug. And so we seek to be a really good partner with pharma, offering whatever white glove or pharma services that they would potentially need, we're able to be very flexible in those needs.

And so being a high-quality patient and physician-preferred pharmacy, and then layering on top of that the relationships we have with pharma, has been very beneficial to continuing to win that. As I mentioned, we typically have a pretty good outlook and are oftentimes working with manufacturers 12 months in advance of a launch or a launch. And so again, we have pretty good visibility into what that looks like.

Great. And sort of sticking on sort of the financial model insight. So on the gross profit per script side, the company has reported some upside that's been driven by mix towards specialty. How do you see the gross profit per script? How would you sort of provide some thoughts around sort of the modeling of that moving forward? Do you see that trending relatively stable? Or do you see further room for mix-driven expansion on the forward?

Yes. So as you think about script growth, so what we report externally is obviously just total gross profit per script, because we just have the total pharmacy script. Certainly, depending on how growth rate changes in each of our individual businesses could impact the GP per script, but as -- and that's the mix shift. So if specialty is growing faster than other areas of pharmacy, we've seen that shift up.

But what we've seen in each underlying business is expansion in margin, which we think is very healthy. So we're focused on driving healthy growth in terms of dollars and mix across each of the different opportunity sets that we have.

Okay. Great. And for a new analyst or portfolio manager that would come in, there's a few things that are a little bit different, right, about sort of the pricing dynamics and margin dynamics and some -- in this business because you've got a couple of things playing out here. One, around the generic conversions where that could be a revenue headwind, but it translates into an EBITDA tailwind. And then also, we've had in the home and community pharmacy side some of the nuances around the Inflation Reduction Act and some of the regulatory changes that went into effect there that also has sort of pressured revenues and pressured sort of pricing yield, right? But you still were able to deliver gross profit growth there.

And so I know that those are sort of 2 different dynamics, but we have 1.5 minutes left, but I think it's really helpful I think to sort of just maybe to understand those dynamics, and really ultimately around those what matters in the modeling moving forward.

Yes. So to your question on generics, we think generics are good for everybody. The price comes down and is a revenue headwind, as you note. But typically, the competition on the manufacturer side and the cost of the drug allows the cost to come down even more. And so that is the dynamic around generics.

As it relates to IRA, certainly, that has been a headwind to revenue. We have been able to mitigate the EBITDA impact for the drug and specialty pharmacy. Where we have the impact is, from a profitability standpoint, is in home and community pharmacy. There has not yet been a fix legislatively to the impact to the pharmacies on IRA, and so it was left to the pharmacies to negotiate individually with the PBMs on an enhanced dispensing fee.

So we were able to partially mitigate but not fully mitigate the impact associated with the IRA impact to BrightSpring. And we'll look to continue to try to improve on that enhanced dispensing fee. Certainly, our government relations team is actively working, as are the industry experts and advocacy groups, regarding the home and community pharmacy and the impact of IRA to the pharmacies.

You think, and we'll probably wrap it with that, that there should be some momentum? I mean, clearly, I think there's an acknowledgment of D.C. that the intention was not to penalize pharmacies in order to shift profitability to PBMs. That's certainly not a part of what the narrative has been in Washington. But again, like you said, there hasn't been a fix yet and there's a lot of just unproductive sort of areas of focus in Washington right now.

Yes. It is certainly a focus area for us, to make sure that we're advocating for the industry, as the industry groups are doing, to make sure that people understand what we believe is the unintended consequences associated with that.

Yes. All right. Well, we are out of time. Jen, thanks so much for joining us. And again, I hope you have a productive rest of the conference.

Great. Thank you.

So the total growth was -- in the guide is 29% to 34% year-over-year. Organic represents about 23.5% to 28% growth. So really strong organic growth expected.

And with that guidance change, when we look at the revenue change and EBITDA, the incremental margin was pretty high. So, kind of, help us understand, like what was this incremental, I guess, EBITDA flow-through that kind of comes at this very high margin?

Yes. So the first is from a provider standpoint, there was a revenue raise. Volumes are expected to be stronger, and there are also some operational projects that we expect to come online. So associated with that, that tends to have a higher margin profile than the pharmacy side.

Pharmacy, we also do expect volume growth, and we also had both -- so there's benefit from an EBITDA standpoint in pharmacy, both on volume and mix of the drugs, but also additional operational projects that benefit margin that we expect to come online as well.

Right. And you mentioned in the pharmacy, right, this EBITDA flow-through on these volumes and some mix, right? But clearly, when we look at the gross profit per script, grew about 30% year-over-year, very robust growth. So kind of -- can you help us understand -- I know you don't want to specifically put numbers on different items, but a couple of different categories, right, that drove that increase in the gross profit per script. So kind of help us understand the magnitude, like which is the biggest driver versus the smallest driver of that growth?

Yes. So we did see throughout 2025 gross profit per script increasing throughout each period, and that was related to drivers. So some of that is just natural increases that we would expect to see in Q1 as well increasing. But I would say the drivers of that are mix related to the growth rates in our different business lines. So our specialty pharmacy had the highest volume script growth. That tends to be the highest per script dollar that we have. We did see mix within mix shift of different drugs within specialty pharmacy and home infusion pharmacy that benefited the margin. And we did see operational initiatives. So we had gross profit per script and gross profit margin increases across all of our pharmacy businesses.

So home and community pharmacy, despite the IRA headwinds, also saw gross margin increases -- percentage increases that was associated largely with the operational initiatives and focus that team has put in place there. So really a wide variety. We also sort of lastly did have incremental hub volumes. We added a couple of new hub programs and services as we launch new LDDs and that tends to be pretty high margin with no scripts associated with it.

Right, exactly. And actually, on this last point, I want to touch base on that because you've been calling out this fee-for-service hub services as a driver of revenue growth and now also the margin growth, too. So is there something to kind of call out in terms of what's driving this part of the business?

Because yes, it does come at high margins. Is there something that is changing in terms of like the compliance for the manufacturers, where they're kind of looking actively for this? Or is it just something that you're kind of doing on the core business that also comes with the add-on revenue stream?

Yes. We are seeking to be a good partner to all of our trade partners as it relates to specialty drugs that we're serving. And we work with them closely to understand what needs they have in service of their drugs.

And to the extent that there are opportunities for us to provide a touch point and provide these services or data, other information services around their drugs. We're just working with them to see how can we be very helpful. I think it's a future opportunity for us to continue to build out. It is providing stickiness. But I would say it really relates to just trying to be very helpful to manufacturers as they're launching new drugs, and we've been able to do that well.

Because you also mentioned that in some cases, you do this -- you provide a service even if you do not distribute a drug, right? So there's something that those makers see that you can provide and maybe others cannot. So maybe can you explain a little bit why they come to you for these services?

Yes. So certain manufacturers maybe smaller pharma companies that don't have sort of all of the departments that maybe a big pharma would have or in some cases, other areas, they see the hub services that we've been able to provide and the information and data and how we've been able to service patients well.

And so if there's a natural fit and it makes sense, then we've been open to those opportunities. I would say the majority of our hub services, though, are related and those activities are related to drugs that we do serve.

And you mentioned right, oncology business, that's really where a lot of growth is coming from with these new product launches and you guys essentially winning a lot of that business.

So is there anything that kind of keeps you up at night, as they say, any risk to that growth? Because obviously, it's been growing so fast that always kind of like you would question like how long can you grow at that pace?

Yes.

We're really proud of being able to drive growth across all of our different businesses in pharmacy and provider, seeking out opportunities for acceleration of growth or activities, whether it's operational improvements, different adjacencies or services that we can provide to be very relevant. And so I think having that diversified and complementary platform has allowed us -- has given us a lot of benefit from a risk standpoint from a growth as we ultimately can direct investments and focus our growth areas in a number of different areas that we would see. We're in really attractive markets. That includes specialty pharmacy, but many of our other areas, we consider extremely attractive. And so that's really how we balance that risk. We're not just one type of company. We have a lot of growth opportunities.

And as we think about this dynamic around BrightSpring winning these contracts essentially. So can you walk us through why Onco360 is sort of the go-to place for some of these drugs in terms of what are the other choices, who are your competitors, who are you winning that business from essentially?

Yes. We've been focused from a specialty pharmacy standpoint on providing great service and access to life-saving, life-changing and life-extending therapies. And so -- and doing that in a really high-quality way. And as we have done that, I think that has propelled wins in new LDD spaces for us as we are really focused on white glove service to customers. So pharma has gotten comfortable that a handful of pharmacies, a small handful of pharmacies can service the needs of all the patients for their drug and to do that in a very high-quality way. And so that's what we're really focused on, ultimately, providing consistent and reliable service to serve the patients as best as possible, and that has been a winning formula for us.

So who are your main competitors? Maybe talk about that? And also, what's your market share in sort of your defined market, right? Because the specialty pharmacy is a broader term.

But then inside that, you kind of target the oncology more than anything and now you're kind of expanding into these other rare and orphan diseases. So is there a way to think about what's your current market share in these categories and kind of how you're thinking about that growing?

Yes. For us, we really don't focus on an entire market. We focus on individual drugs and whether or not we think that those drugs make sense in our portfolio and our platform. So we are really focused, as you know, on LDDs and limited -- these limited network drugs. And so we focused a lot of our efforts in that area, both from a sales and targeting with pharma that we have historically very much focused in the oncology space. That is really at the core of the history of our specialty pharmacy business.

But we have expanded into certain rare and orphan disease states over the years as that very high-touch, white glove specialty pharmacy model that we put in place works well in. So it really is a disease by disease, drug-by-drug standpoint. So I think you'd really have to just look at all of our drugs and our percentage, obviously, we seek to be higher than what our market share would otherwise be.

If it's 2 pharmacies, we would seek to be higher than 50% market share on that drug. If we were 1 of 3, we would seek to be higher than 30% market share on that drug.

And you mentioned the rare and orphan as sort of the next sort of area of expansion and growth. Is there a way to help us quantify or think about the size, the relative size? Like how big is that kind of vertical inside the specialty pharmacy segment and kind of where do you think this could be?

Yes. As you look at the pipeline of rare and orphan and oncology drugs that are looking to come to the market in Phase III trials or earlier, there's a really extensive pipeline in that area.

So we oftentimes are in touch with and working with manufacturers or trade partners, oftentimes, what could be up to 24 months in advance of a launch. More frequently, I would say it's probably closer to 6 to 12 months. But we're oftentimes working with them on the launch of their drug and figuring out sort of everything necessary to do that. So we have a pretty good visibility and line of sight into the pipeline about somewhere between 6 to 18 months out, I would say, on LDDs that we expect to launch in the next year.

And I guess you alluded to this, that more and more of these drug makers decide to go the route of exclusive right contracts or distribution. So kind of what's the -- what's driving this decision from these drug makers? Like is there something that happened in the marketplace? Or is it because the drugs we're talking about are kind of narrow in the population they target, and that's why they kind of -- like they don't need the national coverage or maybe they just need make sure that reaches the limited number of patients that are out there. So kind of walk us through the thought process from the drugmaker side and why they kind of go in that route?

Because clearly, you guys put out the strategy where the last 2 years, the number of exclusive contracts went up dramatically from prior years for you guys?

Yes. So I would say when a manufacturer is deciding to go exclusive, I think it relates to what is the size of the market of that drug and they're looking at a pharmacy and whether or not they have the capability to service the entirety of the market for that drug. If they feel like they would want extra coverage, that's sometimes where we're seeing 2 pharmacies that might be in a narrow network or an area there. So I would say it probably relates more to the size of the drug, I would say. But again, having a very narrow network, whether it's 1 or whether it is 2, I think they've gotten increasingly comfortable that the pharmacies that they are working with are able to get national coverage for the service of their drug.

And as it relates to the PBM-owned specialty pharmacies, clearly, they're trying to push that business to grow faster than maybe their traditional PBM. So are you looking at these guys and saying, "Hey, this is like a real competitor?

Could they kind of try to encroach into your target market more than maybe historically? Kind of walk us through your thought process about the maybe competitive landscape changing, if at all?

So again, we see the importance for pharma in selecting LDD. And again, I'm speaking to the types of drugs that we're targeting specifically. We see what is really important to pharma is having a partner that is going to work very closely with them, high-quality services to the patients. Over the years, pharma has been able to see the service that our teams are able to provide to the patients. And so they've been able to get comfortable that we are able to meet the needs of those patients.

So do you expect any change in this dynamic as in like would these makers kind of have something and others say, "Hey, like we're going to reverse and now we're going to the network.

We continue to be very focused on providing whatever support that pharma needs in support of their drugs. Our NPS scores for patient satisfaction are consistently over 90%. And we've had a couple of quarters where it's been 100% NPS scores. Physician satisfaction scores with us as a pharmacy has been really high. Our time to first fill measures are consistently 50% or less of the average specialty pharmacy that would be out there. Medication possession ratio, which is an adherence measure, we have really strong adherence and medication possession ratio because of proprietary processes and things like that we put in place to really make sure that we're wrapping our arms around these patients as they're taking these drugs and supporting them through that.

So those are the things that we're focused on controlling, and we think continuing to do those really well will be -- will continue to give us access to those drugs.

So we, I guess, talk a lot about the new drugs launches for the LDDs, but also the other dynamic here for the company is around the branded switching to generics.

So maybe kind of walk us through that in terms of what it means for the company, right clearly, there's some top line headwind, but there seems to be also a tailwind to EBITDA margins from that. And also what is the time line on a typical generic? I know this could vary dramatically based on the product, but kind of how should we think about that going forward?

Yes. So I think it's very common in industries like pharmacy or just like any other industry or provider industry to have different reimbursement rates for different types of products.

And we really think about managing our products over a very large portfolio across our branded and generic pharmaceuticals that we offer and try to attract the most attractive products. And what I would say is that generics are really good for everybody. They're good -- they bring down the cost of health care.

Our company does serve across our entire script volume base, a lot of generics, and we're trying to increase generic utilization, which reduces the cost of the health care environment. From a -- what has traditionally happened in the specialty generic space is the prices come down, but the costs come down more. And so from a dynamic standpoint, that has been beneficial.

So you're right, it does provide a headwind to revenue, but ultimately still has been favorable from a margin standpoint.

And how quickly you see the margin lift from the generic launch? Is it sort of immediate or it takes a little bit of time to kind of play out?

So we -- historically, we've seen margins just really be consistent and move sort of down consistently over a very long period. And I think that's been a dynamic that's been at play for a number of years.

And maybe switching gears from pharmacy to provider segment. There are a couple of things I want to hit on. I guess maybe first on the Amedisys acquisition. So it sounds like Q1 kind of came in much better than maybe what the initial commentary implied for the contribution from that business.

So kind of walk us through how we should think about the ramp-up for that asset, I guess, through the year?

Yes. We did have a strong Q1. Volumes came in ahead of what our plan was. We've spent a lot of time integrating that asset, and we're really excited to have those members of those branches as part of our team. And we see the excitement, and I think that was evidenced in the volume increases that we saw.

So we're seeing a lot of positive momentum there. We do have investments planned, and these were always planned in Q2 and Q3, things like getting them onto our version of our operational systems. Some other operational processes like central intake and other areas. So those are some costs still to come that will -- that we do expect to impact Q2 and Q3.

But we are obviously looking forward and pushing the teams on volume growth that they can get and believe that we'll be exiting '26 in a good place on that acquisition. It's performed really well for us.

Okay. Great. That's what I was asking essentially. And then as we think about this home health business, so now you doubled down with this acquisition because by the way, this is mostly home health.

There's a little bit of hospice that came from that asset. So should we expect more growth -- external growth, like adding more assets? Or for now, you kind of like the way this platform looks like?

So from a home health standpoint, obviously, in 2026, the team is pretty busy with the integration of the Amedisys and LHC branches. I think if we were to do anything, it would be very geographically makes sense tuck-in. So we bought a CON license. It was a really small dollar item we bought at the end of Q1 in an area right around some branches that we received.

So we felt like it made sense. It was able to be pulled in then into the geography that we had just put leadership in place, and it made a lot of sense. So there might be small things like that, really small tuck-in geography items.

But at this point, I don't expect anything that would be more significant than that in '26.

And hospice business seems like that's growing pretty nicely there. So any investments we should expect there sort of going heavier in hospice versus home health?

So we're really proud of the balance sheet position that we've gotten ourselves into.

We were at 4.5x right after the IPO. We've delevered to 2.27x at the end of Q1. That gives us a lot of flexibility for additional M&A. As we think about the target areas for potential M&A, what we've said is that areas for home infusion, hospice and rehab pharmacies would be probably our highest priority areas, but we obviously have a number of different businesses that we serve, and we're constantly evaluating all the opportunities that are in front of us.

Just a reminder that most of our deals are proprietary. We have a really strong corporate development team that has done a great job generating deals and deal flow. And we also have an integration management team that has allowed us to be successful in integrating the assets and other acquisitions to be able to achieve what has been a historical 4x pro forma multiple on our transactions.

No, exactly. And then, I guess, since you mentioned the capital deployment, so you said home infusion hospice, rehab are priorities. Should we expect more of that coming later this year because you also mentioned the integration of the Amedisys acquisition? Or should we just think integration could happen as you also execute on some other transactions?

Certainly, we don't put any M&A in our guide, and we would just -- I think we'll have a corporate development team that is focused on identifying what could be good strategic assets for us.

From a timing standpoint, we don't know how all of those would necessarily play out from a timing standpoint. But from a capital availability standpoint, we certainly are below our long-term target leverage. We will -- we're not going to be in any rush to spend up to that leverage necessarily. We're going to want to be very thoughtful in any deals that we do or any use of capital deployment will be very strategic and we think makes sense for the company.

And coming back to the provider segment, so I asked about home health and hospice. I guess personal care is actually still pretty sizable, even though, relatively, provider small in pharmacy, but still inside that provider segment, personal care is sizable. So how are you thinking about that business? Because that doesn't seem like that's growing as robustly as maybe some of the other provider service lines.

So kind of what's your view of that strategic importance or value of having that asset in the portfolio?

Yes. We really like the set of assets that we have. We think it provides differentiated opportunity for us to serve our patients in a more holistic way across various different settings.

That business has tended to be more steady in terms of growth. That is not a significant growth driver. It is a really great generator of cash and has been just really steady, we think, provides the strategic importance around serving more holistically the senior patients that we have, especially as we lean into areas of providing multiple services to the same patient.

And the last piece, very small, is the home-based provider or the primary care providers. So kind of what's the latest thought process there? There's a lot of disruption in value-based care over the last couple of years. I guess you still seem to be investing and trying to grow that business. So any latest thoughts about that?

Yes. We certainly see an opportunity over time to be able to get differentiated payment models across the services that we're providing. So we're in good markets and serving a lot of the same patients in various different settings. And so we do think that, that's going to provide an opportunity for differentiated payment models over time. And so we continue to lean in, in that area, but it is a very small piece of our business today.

And home infusion, as you mentioned, right, coming back, I guess, the pharmacy segment, you clearly want to grow more aggressively in that business, but your public competitor seeing a lot of disruption to their business due to the CID and STELARA specifically. So kind of what gives you confidence that this is still a good business to invest in?

Because clearly, you guys were hiring a bunch of people there investing and growing both acute and chronic. So kind of how do you think about the long-term kind of growth outlook for that piece of the business?

Yes. We believe that the infusion pharmacy and the home infusion or outside of the hospital setting is an important area of pharmacy. And we do believe that there are a lot of opportunities within that space.

So a scaled provider, that is definitely something that we want to be more scaled, and there's a few geographies that we don't really service.

And so wanting to make sure that we have pharmacies in all of the right key target areas to target patients in certain areas. So we think expansion of some of our pharmacy footprint is definitely an area that we're leaning in on. But we do think that the infusion space is an area that does have opportunities available and it is a good market.

And walk us through how you think about the growth outlook there in terms of the top line and the bottom line going forward, I guess, long term?

Yes. So we're focused in terms of both acute and chronic therapies. So acute, there have been a lot of players that have gotten out of that space. It is difficult to do if you're not local. And so that's where the importance of having some expanded pharmacy footprint is important to us. We think scale in infusion is important because it gives you leverage from a payer standpoint. And so that is also beneficial to us.

We do think that there are therapies in the chronic space that are attractive.

And we'll obviously, as we do with any of the areas that we're targeting, I think, be very strategic about making sure that we're going after what we think are the most attractive opportunities at any time.

Right. I think this is all the time we have. So thank you so much, and Thanks, everyone.

Thank you.

Hello, and thank you for standing by. Welcome to BrightSpring Health Services, Inc. First Quarter 2026 Earnings Conference Call. [Operator Instructions]

I would now like to hand the conference over to David Deuchler. Please go ahead.

Good morning. Thank you for participating in today's conference call. My name is David Deuchler with Investor Relations at BrightSpring. I'm joined on today's call by John Rousseau, Chief Executive Officer; and Jen Phipps, Chief Financial Officer. Earlier today, BrightSpring released financial results for the quarter ended March 31, 2026.

A copy of the press release and presentation is available on the company's Investor Relations website. Please note that today's discussion will include certain forward-looking statements that reflect our current assumptions and expectations, including those related to our future financial performance and industry and market conditions. Such forward-looking statements are not guarantees of future performance. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from our expectations. We encourage you to review the information in today's press release and presentation as well as our quarterly report on Form 10-Q that will be filed with the SEC, including specific risk factors and uncertainties discussed in our Form 10-K and Form 10-Q.

Such factors may be updated from time to time in our periodic filings with the SEC, and we do not undertake any duty to update any forward-looking statements, except as required by law. During the call, we will use non-GAAP financial measures when talking about the company's financial performance and financial condition. You can find additional information on these non-GAAP measures and reconciliations of our non-GAAP financial measures to the most directly comparable GAAP financial measures to the extent available without unreasonable effort in today's earnings press release and presentation, which again are available on our Investor Relations website. This webcast is being recorded and will be available for replay on our Investor Relations website.

With that, I will now turn the call over to John Rousseau, Chief Executive Officer.

Good morning, everyone, and thank you for joining BrightSpring's First Quarter 2026 Earnings Call. I'd like to start by thanking everyone at BrightSpring who drives our mission forward and makes a lasting impact every day. We're grateful for their hard work and commitment, enabling us to deliver high-quality and timely care to patients. Before we speak to first quarter performance, a few key messages and takeaways from our Investor Day in March and why we are optimistic about the company's prospects in the years ahead. BrightSpring is a national leader in Home & Community health services, serving complex patients in the health care system. We deliver high-quality services at significant scale with a disciplined operating model that focuses on patient and provider outcomes. Throughout our service lines, that focus on quality care underpins commercial efforts supporting sustainable growth.

Our organizational culture of continuous improvement and best practice sharing will continue to enable operations that expand the impact we're making and providing comparatively lower cost services for complex patients across the country. In Pharmacy Solutions, the growth outlook is healthy with the specialty and infusion businesses continuing to deliver impressive script growth and patient satisfaction scores. We continue to see strong volume performance from both brand LDDs and generics, and we added 4 exclusive and UltraAR LDDs to our portfolio in the first quarter, bringing our total number of LDDs to 153.

Infusion represents one of our larger geographic expansion opportunities looking forward, covering today about 1/3 of the country on the acute side and half the country in chronic specialty. Home & Community Pharmacy is looking to drive organic profitable growth in assisted living, behavioral, hospice, PACE, skilled nursing and other markets, supported by investments in automation across our national pharmacy footprint. On the provider side, in our home health care businesses, we continue to expect organic growth to be underpinned by market share gains from high-quality services and scaled market development and clinical support teams that we continue to invest in. In 2026, we are integrating the acquired Amedisys and LHC branches and expect approximately $30 million of EBITDA contribution in year 1.

We are continuously looking to innovate services and associated operational processes to drive outcomes and growth with numerous payer agreements and partnerships that reflect this. In palliative and hospice, the strength of our quality results and our patient-centric approach positions us well in a market that remains significantly underutilized with only half of eligible patients receiving such valuable care today. Rehab continues to deliver consistent growth in Home & Community settings with excellent clinical outcomes as we continue to expand in the senior setting through rehab in motion and assisted living facilities. Home-based primary care and value-based care initiatives, while still in earlier stages, produce meaningful reductions in hospitalization, help coordinate other needed services and represent significant potential for future growth as we scale. BrightSpring is firmly positioned on the right side of the most important trends in health care to address system and patient needs with a differentiated enterprise and a unique set of assets that deliver real solutions to patients, providers and payers alike. With that context, let me turn to the first quarter.

As a reminder, the company's financial results and 2026 guidance pertain to continuing operations and do not include results from the divested Community Living business nor the impact of any future closed acquisitions. We completed the sale of Community Living to Savita on March 30, 2026, which resulted in net cash proceeds before tax of approximately $811 million. The proceeds from this transaction will be used to further strengthen the balance sheet, including both debt paydown and cash availability. Overall, we are pleased with our first quarter financial results with total company revenue of $3.6 billion that grew 26% year-over-year. Pharmacy Solutions revenue of $3.2 billion and provider services revenue of $442 million represented 25% and 28% growth, respectively.

First quarter 2026 adjusted EBITDA of $190 million grew 45% year-over-year with an adjusted EBITDA margin of 5.3%, a 70 basis point improvement year-over-year. Margin expansion was primarily driven by mix and operational efficiencies across the organization. On cash flow, the company realized $123 million of cash flow from operations in the quarter, excluding fees from the Community Living divestiture. Leverage was 2.27x as of March 31, 2026, which declined from 2.99x as of December 31, 2025. Pro forma leverage on March 31 was 2.40x when factoring in cash taxes associated with the Community Living proceeds that will be paid in Q2. Performance in the quarter was driven by a high quality of care and patient satisfaction.

In Home Health, over 91% of our branches are 4 stars or greater. We have an industry-leading timely initiation of care of greater than 99%. And in Q1, 65 home health locations were named a best home health provider by U.S. News & World Report. In hospice, quality measures remain well above national average with significantly more visits provided, a top 5% ranked hospice program in the U.S. and a CAPS overall hospice rating of 87%. In rehab, patient satisfaction scores are at 98% with outpatient and 97% with Home & Community rehab. In personal care, we have a client satisfaction score of 4.6 out of 5, consistent with the fourth quarter.

On the Pharmacy side, in home and community, dispensing accuracy was 99.99%. Order completeness was 99% and on-time delivery was 96%. And in infusion, our patient satisfaction score was 94%, 97% of discharges were due to completion of therapy. And importantly, we saw recent improvements in both acute and specialty turnaround times near internal goals aimed at best-in-class. And specialty pharmacy demonstrated a consistently high medication possession ratio of 92.1% in the quarter, along with time to first fill of 4.6 days, both much better than national average.

I'd like to close by emphasizing that BrightSpring's continued focus on serving large and growing markets, providing high-quality care for patients building and leveraging scale and institutionalizing a disciplined operating model are what collectively differentiate the company. We serve expanding populations of high-acuity individuals with solutions delivered in the home or community settings that consistently improve clinical outcomes while reducing total cost of care. We are deliberate in our corporate strategy, and we use our platform scale to generate operational efficiencies while deploying best practices across our pharmacy and provider service lines, equipping them with the resources and capabilities they need to execute and grow.

We believe this approach and model is what creates durable value and the most positive impact for all of our stakeholders. BrightSp's first quarter saw a broad-based momentum across both the pharmacy and provider segments that reflected execution on our operating and growth priorities, which we laid out at our Investor Day in March. We feel good about the performance of the business through the first 3 months and are on track to deliver the updated full year guidance provided today.

With that, I'll turn the call over to Jeff.

Thank you, John. Before I discuss our financial results for the first quarter of 2026, I'd like to remind you that in the first quarter of 2025, we began to record the Community Living business in discontinued operations, as indicated in the press release and 10-Q to adhere to accounting standards required on an interim basis. As such, all BrightSpring financial results and forecasts that I will discuss are related to continuing operations and exclude Community Living and any acquisitions that have not yet closed. Management believes the presentation of the non-GAAP financials from continuing operations is a useful reflection of our current business performance. In the first quarter of 2026, the total company revenue was $3.6 billion, representing 26% growth from the prior year period. Pharmacy Solutions segment revenue in the quarter was $3.2 billion, achieving 25% year-over-year growth. Within the Pharmacy segment, specialty and infusion revenue was $2.6 billion, representing growth of 36% from prior year, which was driven by strength in specialty and market adoption of existing LDDs, new LDD wins, brand to generic conversions and generic utilization, growth in fee-for-service programs, including hubs and service agreements and strong commercial execution. Infusion showed solid volume growth and operational metrics driven by process improvements.

Home & Community Pharmacy revenue was $527 million, representing a decline of 9% year-over-year due to an approximately $50 million impact from the IRA, which was expected, along with our decision to exit any uneconomic customers, both of which we have previously discussed and came in line with our expectations. We expect to see a revenue impact from the IRA of approximately $45 million for each of the remaining quarters of 2026, totaling our Home and Community Pharmacy revenue impact of approximately $175 million for the full year of 2026. In the Provider Services segment, we reported revenue of $442 million in the first quarter, which represented 28% growth compared to the prior year. Within the Provider Services segment, Home Healthcare reported $266 million in revenue, growing 49% versus last year with strong census growth, de novo expansion, preferred MA contracts and ongoing successful integration of our acquired branches.

The acquired assets contributed $79 million of revenue and approximately $9 million in adjusted EBITDA in the first quarter. We are encouraged with how well the integration process is going and are optimistic about the performance for the year. Rehab revenue was $75 million, growing 7% versus last year, with momentum in person served and hours billed in core neuro rehab, de novo additions and continued expansion in our Rehab in Motion program. Personal Care revenue was $102 million, representing growth of 4% year-over-year, driven by modest growth in person served and stable operations. Moving down the P&L. First quarter company gross profit was $482 million, representing growth of 43% compared with the first quarter of last year. Adjusted EBITDA for the total company was $190 million in the first quarter, an increase of 45% compared to the first quarter of 2025.

Adjusted EPS for the total company was $0.39 in the first quarter. The company's profitability growth and margins in the first quarter benefited from the performance dynamics John discussed and the impact of investment initiatives to drive operational improvement across the organization. Throughout 2026, we expect targeted commercial strategies and our operational and procurement initiatives to support both investment and growth from best practices deployment in operations, streamlining and ongoing efficiencies realized.

Turning to segment performance in the first quarter. Pharmacy Solutions gross profit was $301 million, growing 48% compared with the first quarter of last year. Adjusted EBITDA for Pharmacy Solutions was $169 million for the first quarter, an increase of 46% compared to last year, representing an adjusted EBITDA margin of 5.3%, which was up approximately 70 basis points versus last year. Strong performance across the therapy portfolio, favorable mix and fee-for-service contributed to profitability performance. Provider Services gross profit was $181 million, growing 35% versus the first quarter of last year. Adjusted EBITDA for Provider Services was $66 million for the first quarter, growing 29% versus last year, representing an adjusted EBITDA margin of 14.9%, up approximately 10 basis points versus last year. On a total company basis, cash flow from operations was $123 million in the first quarter. Recall that the discontinued operations cash flow are included in total company reports. As we look forward to the balance of the year, excluding community living-related cash flow impact, we expect to deliver approximately $500 million of annual operating cash flow.

Our adjusted EBITDA growth, combined with our cash flow generation during the quarter, led to a leverage ratio of 2.27x as of March 31, 2026. This cash flow and leverage profile provides the company with some additional flexibility in capital allocation and capital structure as we move throughout the year. As of March 31, net debt outstanding was approximately $1.7 billion. As John mentioned, we received approximately $811 million of net cash proceeds before tax from the $835 million gross cash consideration for Community Living. Approximately $100 million in taxes is expected to be paid out in the second quarter of 2026.

We will remain active in evaluating options for the existing term loan and the appropriate capital structure for the company over the coming months in light of continued strong operating performance. We expect quarterly interest expense to be approximately $35 million. Turning to guidance for 2026, which excludes the community living business as well as any acquisitions that have not yet closed. Total revenue is expected to be in the range of $14.725 billion to $15.225 billion, including Pharmacy Solutions revenue of $12.85 billion to $13.3 billion, and provider services revenue of $1.875 billion to $1.935 billion. This revenue range reflects 14.1% to 17.9% growth over full year 2025, excluding community living in both years.

Total adjusted EBITDA is now expected to be in the range of $795 million to $825 million for full year 2026. This would reflect 28.7% to 33.6% growth over full year 2025, excluding community living in both years. Included in total adjusted EBITDA is expected contribution from the Amedisys and LHC assets acquisition of approximately $30 million.

I will now turn it back to John.

Thanks, Jen. And thank you for your time today to go through BrightSpring's First Quarter 2026 results. We'll now open up the call for questions. Operator?

[Operator Instructions] Our first question comes from the line of Ann Hynes with Mizuho.

I just want to talk about some of the growth initiatives hitting the P&L this year, especially with infusion. I know that's been a big focus for the company, expanding the chronic portfolio. Can you just let us know how that's going, what the growth rate is, maybe what drug classes you're focused on?

Yes. I hope you're doing well. I think pretty characteristically we saw a broad-based growth across the organization on both the provider and the pharmacy side provider obviously had a bit of a tailwind there from closing of the home health branches, but notwithstanding that, we saw really good growth. One of the reasons we had a little outperformance on the home health branches that were acquired was a step-up in admissions, we were able to drive with them being under our roof for 3 to 4 months.

So it was a nice quarter across the company in terms of volume growth. On the pharmacy side, the ramp-up of existing LDDs the launching of new LDDs and focused growth around driving generic utilization led to good growth within our Onco360 in CareMed business. I'd point out within that business, quite a few of our LDDs under CareMed now are outside of oncology, and that's been intentional. And so not only did we see script growth rates over 30%, but we saw a continued growth rate in the number of new accounts, new prescriber accounts that we're into, as we not only continue to invest in more reps, particularly on the West Coast, but then also get into some therapeutic states in addition beyond oncology as we've continued to focus not only on oncology, but any other therapeutic area of interest, specifically within infusion then, we did see double-digit growth on both the acute side and the chronic specialty side. So I think as we've mentioned before, we've been underweight on chronic specialty.

So we think that's an opportunity. We did go live in early Q2 with a concierge program around IVIG and our thoughts are to build out, and we are building out concierge programs around targeted therapy. So it was a productive quarter with solid double-digit growth across both of those areas within infusion.

Great. And just for a follow-up, obviously, your leverage is at a nice point after the repayment of debt. If you -- I guess, one, would you be interested in larger M&A? And if you would be -- what would be a leverage you would be comfortable going back up to for the right asset?

Yes. It's -- I know it's in particular, very pleased with the balance sheet, but we all are. And I think we've sort of said under 3x, mid-2s is our is our longer-term target where we'd always like to be. I think you'll continue to see us act the way we have historically with a disciplined approach. I think if you look at least at the last 7 years, there's been to transactions that have really worked out well for us that have been a little bit more sizable. The original home health and hospice acquisition of a boat, which gave us critical mass there. and then this most recent one here with the LHC and Amedisys assets.

But I think we do have a little bit more flexibility, obviously, but we will continue to try to make sure we look at anything that makes the most sense in the long term across the organization. I think our bread and butter will continue to be geographical expansion with tuck-ins in our current businesses that allow us maybe to get into some new markets more quickly and where it makes sense or where you need licensure or a CON, et cetera.

I think deals in that sort of mid-range or 5% to 10% are probably easier to do. But as we look at our pipeline right now, nothing too different than historically. And whatever we do, we'll continue to be very measured and Yes, we would like to stay within that target leverage range with anything that could come up. But I would say, at least for now, certainly a historically very consistent view and strategy is as we look out at least probably through the next couple of quarters.

Our next question comes from the line of David Larsen with BTIG.

Congratulations on another excellent beat and raise quarter. Can you maybe talk a little bit about the overall Medicare environment and how this is impacting your business, like some of the health plans, obviously, are talking about high trend pressure on margins. And I think you had talked a bit about the potential for getting into some value-based care arrangements in Medicare that could be a benefit to you sort of general thoughts on the overall Medicare landscape and how this is affecting you would be very helpful.

Yes, sure. We've just seen consistency on the Medicare side this year. no major changes. On the pharmacy side, from a Part D perspective, we've continued to, I think, be a partner in driving cost down there in terms of generic utilization over time. on infusion, we continue to press in D.C. with the industry and the associations around some of the fixes for the Cures Act to provide much greater access for Medicare patients, beneficiaries being able to receive very valuable home infusion in their own home instead of the hospital that has a massive potential benefit for the program and we continue to be optimistic that at some point, that change and that update can be addressed and can be implemented on the provider side on Home Health & Hospice, we've been pleased with where those rates have shaken out over the last 6 months. So nothing too different that we've seen organizationally in the last even 6 months, I would say, as it relates to value-based care, we continue to make some progress there.

We're going to be applying to this new lead ACO program that's in the works applications are due in May, and we'll see how that goes. Hopefully, we make it. But that business, we continue to invest in with some really good people even here recently that we've added to the business. And I would say, operationally, being able to serve these patients across skilled nursing assisted living in the home with a house calls model is not the easiest thing to do in the world. And we've been focused on doing that extremely well with really good quality outcomes. I think we've really achieved that over the last couple of years, and our focus now is on really trying to scale it. And so we're looking to next-gen ACO programs in addition to the one we're in.

We had a successful year there last year and we've never been as positive about the ability to reduce cost and very desirable care settings as we are today. So that will continue to be a passion for us internally in terms of how we can take care of more folks in their own home in a value-based care model with the most proximal and intimate services possible. We're leaning in and building out that hub as much as we can to provide oversight in between time and trying to apply AI to all of our data and analytics to be as proactive as we can and as smart as we can with our care approaches.

So nothing too different as we sit here today on the Medicare front at large in terms of traditional payment programs. But I think there are real opportunities for the program. in terms of what we can provide for it in terms of cost reduction in the future across quite a few of our businesses, and we will continue to be passionate about leaning into that.

Great. And then just one quick follow-up, Jen, I thought that we had been talking about $600 million of revenue headwind in 2026 coming from a combination of IRA community, IRA, specialty infusion and then also brand to generic conversions, is that correct? And you obviously beat my revenue estimate by a lot in the quarter. So you're certainly overcoming that really well. Just sort of an update there would be helpful on how that's tracking relative to expectations.

Yes, that's correct. Thank you so much for the question. We did obviously talk about the IRA impact in home and community because it was really obvious from a revenue standpoint, but that is consistent, and we're tracking towards our expected numbers in all of those areas. So just as a reminder, that is about $175 million in -- which we talked about a little bit earlier on the call in Home & Community related to IRA for the full year IRA of about $181 million in specialty and infusion and brand to generic conversions of about $250 million.

Our next question comes from the line of Charles Rhyee with TD Cowen.

Congrats on the results. Maybe, Jen, just to quickly follow up there. besides the revenue headwind, are we still looking at $15 million of mitigated sort of headwind on the EBITDA line that hasn't changed?

That is correct.

Okay. Okay. Perfect. And then I don't think you gave sort of what the specialty script growth in the quarter was, and I was just curious what that number was and what maybe health care -- Home & Community rev growth ex Genesis was as well?

Yes. So our specialty and infusion script growth in the quarter year-over-year was approximately 30% year-over-year growth. specialty was a little bit higher with infusion in the mid-teens. So higher -- specialty was higher than that total infusion in the mid-teens in terms of their script growth. The really strong growth across both of those business lines. Home and Community x the uneconomic customers did did see modest trip growth in the mid-single digits.

Got it. That's helpful. And then maybe just one last question. We're seeing a lot of commentary from PBMs and they're really trying to push sort of their own label, biosimilars.

And so there's kind of discussion of how much more competitive they are getting or at least trying to steer patients into their own sort of captive pharmacies. I would like to understand sort of how much exposure you have on some of those dynamics. And if that's something that you're seeing? And if so, what can you -- what do you do to help kind of get around that?

Yes. I think, Charles, just given our history and product portfolio today, I don't think we have a lot of exposure there. You tend to see more of that on injectables. And if you look at our infusion business, still today, the majority is acute. But we look to be growing on the chronic side, and we are but more from an infusible standpoint versus a subcu or an injectable standpoint. So we just -- we don't have a lot of concentration internally that would have biosimilar risk. And on the Onco316 CareMed side, the predominant form factor is oral solid. So I think we feel good about that. Last little thing on LTC. We are proud of the performance in the quarter on home community pharmacy. We've really put just a top-notch team in there over the past year. They're doing a great job, particularly from an operational perspective and then with our focus on some of these attractive end markets and excluding IRA, that business was up in profitability in the quarter year-over-year.

And our hope and goal is in Q2, even with IRA, we're going to -- we're going to have a really strong up quarter versus last year. So some nice momentum there, too. I just wanted to add that.

Our next question comes from the line of Joanna Gajuk with Bank of America.

So maybe on the infusion, if I may, so thanks for the color in terms of you guys growing double digits in both segments. And as it relates to that business, can you give us an update, is it the growth, I guess, is coming from these 20 or so LDDs which you said you had these LDDs, but you were not really participating. So sounds like you're executing on this already? Or that's still kind of in front of you?

Yes. I think what we said last time is we had won 3 LDDs and we had access to 20-plus more historically. At this point, we've won 5 LDDs in the last 6 months. So we've won a couple more. None of those are of the exclusive or ultra narrow 1 or 2 category is in Onco360 and CareMed. So that's our goal. But nonetheless, nice wins. And I would say, as we kind of put specialty programs in place, you have to win access to the drug. And then obviously, you have to execute on a number of operational initiatives and programs to pull those drugs through in the market, we do such a good job of that on the Onco360 and the CareMed side with all of our wraparound programs, data services agreements, especially hubs that we provide for patients as well. So we're building that out on the infusion side. We launched IG Connect in the quarter, which is a concierge program now for all IG referrals. And we'll look to do that for each one of these LDDs in the future and really have a focus on it to be able to customize that experience for both the manufacturer and the patients. So we are seeing some growth there.

But Joanne, I think we're probably in the early stages of a several year growth focus in LDDs and infusion like we've had over Onco and CareMed for the past decade. But nice continued progress with manufacturers on the infusion side, and we will continue to focus on the pull-through in the programs in the future.

So that was a follow-up. My question was actually about the gross profit per [indiscernible], which was impressive. It was up 50% in the in this quarter year-over-year and sequentially [indiscernible]. So how much is from this new LDD launches, new product lanes versus the generic conversions? And I'm asking of just thinking going forward, how much more room, I guess, is there left on that metric?

Yes. I don't know that we would expect to see too much more continued gains in GP per script. I mean, I think your stability there would be very good. But overall, there were 4 principal drivers for the tick up there. Number one was the disproportionate growth on the specialty infusion side in that business with its gross profit per script. Second was we did have really healthy growth in both brands and generics, but the brand to generic mix shift there. In the quarter, relative from a volume perspective was additive to GP per script. Third is, from a purchasing perspective, we're -- we leverage our scale as much as we can, and we're committed to all of our partners in the supply chain and have I think, very constructive and long-standing relationships there that are really healthy on the supply side.

And what we did from a purchasing standpoint has been helpful in the quarter again. And then really last, but maybe even not least fee-for-service, that's a high gross profit margin business that we have with our hubs and our service agreements. And every time you launch a brand, you typically get some good fee-for-service commercial business out of that, too. And so those were the 4 factors that were all contributing to the gross profit per script change.

Our next question comes from the line of Jared Haase with William Blair & Company.

Maybe I'll pack to here into one. Just as it relates to the margin in the quarter, One thing I wanted to clarify was just a mix comment in regards to margin expansion that you showed in the first quarter, I think all else being equal, we typically assume sort of rapid growth in specialty, particularly on the branded side. Could be a bit dilutive to the overall margin profile. So just wanted to make sure I kind of understood what was going on there and if the mix dynamic had more to do with generics? And then I guess, rolling that forward, how should we think about sort of the cadence of margins for the rest of the year. I think we typically would model margins building sequentially, but your guidance sort of implies full year margins that are consistent with what you showed in the first quarter. So I just wanted to kind of make sure we're understanding the expectation there as well.

Jen, maybe you can take the outlook for the year. But I think we would expect some consistency for sure. On the GP side, you've got the percent margin versus the dollar margin. And I think it was the mix shift that we saw that helped probably proportionally on the on the dollar margin side versus the percent margin if you're tracking with me there. Jen?

Yes. No. So for the rest of the year, I do think we have the potential for slight build. Those things are going to be based on our guidance range, we have a range of 5.2% to 5.6% margins that we would expect for the year. And the things that we are working on is continued leverage of scale. We have a number of operational initiatives that we are building in place. And then from a mix standpoint, as we think about the mix within each portfolio. So as John mentioned, we're working to drive, for example, chronic therapies within infusion. And so as we execute on those, I think we have the potential for slight margin expansion, but largely consistent with what we saw in Q1.

Our next question comes from the line of A.J. Rice.

Just maybe picking up on the comments that Jim just made, I know operational efficiencies have been an ongoing part of your strategy and you're attributing part of the 70 basis points of margin improvement you saw year-to-year to operational efficiencies. Can you just maybe update us on some of the specific areas of focus and any AI-related applications you're looking at there?

Yes. Yes, look, I mean, I think as we've said before, we did a nice job offsetting some of this IRA impact in Q1 in Home and Community Pharmacy. Some really nice efforts there from procurement over the past year, but then also in operations with some automation tools and order intake and revenue cycle, in particular, currently working on something in infusion around order intake as well. Just to give everybody a tangible example because it can be a little aerial sometimes, but you get a 5-inch thick patient packet and intake and infusion and take somebody 2 hours. [indiscernible] enter the relevant information in the system, working on an agent that can do that in 2 seconds. That would be an example of streamlining workflow of which we have 9 or 10 different projects going on internally in the organization. As you look at the home health and hospice side, we've invested a lot in portals. There can literally be 85 different portals that hospitals will send their -- put their patients into upon discharge and you've got to connect to all of them. And so we've done a ton of work there over the last 2 years, connecting into all the portals. You still have to go earn the referral with your clinical liaison but you've got to be in the game by accepting the referral in the portal.

We've done a ton of work there. I think we have evidence of improvement and success in our admissions from doing that. And then I think a last example would be an order intake in home health. We've done a really nice job centralizing that. As some of these assets come over from Amedisys and Optum, they were not centralized, and we're seeing some real benefit there already out of the gates. And so continue to continue to invest in that team. I mean, Jen, we're up to over 20 people on our internal AI team now, and it seems like the more we get into it, the more opportunities you find, but that's going to continue to be a real focus for us. There are -- there's another -- I hesitate to say, but we've got a pretty strong bogey for cost-to-fill reduction in home community pharmacy in Q2 and then more in Q3 and Q4 that we have to hit, and a lot of them are tied to these OpEx initiatives, which are underpinned by some technology systems and automation. So working hard at it, but we are seeing things proceed along the intended path as of now.

Okay. That's great. And maybe just conceptually also ask you about biosimilars. Obviously, you've benefited from tremendous new pacing of new LDD launches and so forth. But I'm also curious about the pace of biosimilars, how biosimilars coming to market has emerged. Do you see that as still the opportunity you thought it was a couple of years ago? Or is there aspects about it to either make you more optimistic or a little more cautious about what that pipeline looks like and what it might mean for you?

Yes. I think as we sit here today, we do not see much biosimilar risk just based on our current portfolio and the revenue in GP that we have from it. So I think conceptually, over time, there's an opportunity for us to participate in that more from a baseline of it's all upside. And I think that's how we're thinking about it. So -- but I think a lot of that is to be determined. If you think about our portfolio today, we have our oncology products. We have our other rare and orphan and LDD that are oral injectable. We have our infusible products that we're leaning into from an LED standpoint. Those are kind of our 3 swim lanes of our primary product today from a specialty standpoint. We are looking just more broadly at the specialty world, any other LDDs or any other just attractive products and thinking if it makes sense to us to participate in any other areas. So I think we will continue to try to refine our strategic assessment of your exact question this year. But I do think that there could be opportunities there. And we don't have any near and present risk in that area today. So hopefully, as we lean into this more, it could be a fourth or fifth swim lane in time.

Our next question comes from the line of Sean Dodge with BMO Capital Markets.

Maybe just going back to the operational initiatives again. John, you gave some specific examples of what you're working on there. But if we think about -- I know those were a driver of some of the margin improvement we saw last year. You're continuing to work on those this year. How should we think about the expected contribution from those in '26, maybe relative to what you saw in '25? The savings or benefits from those you expect to be greater this year than last? And then of all of the margin levers you talked about, where do these efficiency initiatives rank in terms of kind of the amount of EBITDA they're driving? Is this kind of pretty close to the generics? Or is this kind of a distant second?

Yes. Jen, maybe you can sort of tack on to this question. But what we have internally, I would say, is a program that's been consistent over time. I think we mentioned at Investor Day, we've even more formalized, call it, continuous improvement, if you will, into a real Lean Sigma training program throughout the organization. White green black belt you can get, and we've really formalized that. So I think it is very much in our culture just constantly looking for the next thing. I think our data says that we've got over 700 projects that we've completed in the process improvement arena in the last 5-plus years, that has generated 9 figures of savings, of which a ton of it, we've reinvested back into our people and into IT and technology systems.

So over the past several years, we've just had, I would say, meaningful savings that have been either investment and/or EBITDA contributors each year into the organization. I mean, look, first and foremost, we are always going to try to drive growth through a focus on the top line. I mean the 3 things that have driven the company over the past 9 years now that we talk about a lot are volume growth, operational efficiency and accretive M&A.

And we will continue to try to drive each one of those in the future. So the volume growth whether it's on the pharmacy side with LDD wins, trying to maximize generic conversions or whether it's on the provider side with patient volume growth will always be first and foremost. And I would say, the biggest contributor, but we certainly try to complement that. Jen, anything else?

No, I would agree. I think the volume underpinned by our high-quality services has always been our very highest focus. And then as John mentioned, the strength of our portfolio of our company really is at the core of our DNA, is leveraging our scale through smart procurement activities continuing to build. We think there's a continuous opportunity for that in terms of focus on execution in those areas, as John mentioned, we have a lot of people we've been training, just out in the peel hundreds of people that have gone through our White Belt and Green Belt trainings, but also making sure that as we scale that we're going back and leveraging that in our procurement initiatives, and I think that will continue to be an important contributor as well as the volume.

Okay. Great. And then you mentioned before, one of the other kind of growth areas within pharmacy being the fee-for-service business. Just anything you can share around kind of the scale of that business now, how much is that contributing? And what do you kind of see the long-run opportunity being with fee-for-service specifically?

Yes. I mean it's -- I think we've got 31 hub programs today probably more service agreements than that. It's growing in the 40% to 50% range year-over-year. It's certainly not the majority of our GP contribution within our specialty business, but it's no longer $5 million or $10 million either. So I hesitate to get into too many details. But it's a meaningful part of the business. That's really important to us. And I think philosophically is an example of how we try to deepen our relationships as much as we can with manufacturers wherever we can be helpful.

Congratulations.

Our next question comes from the line of [indiscernible] with LRIT Partners.

John, I was just wondering if you have market share data with your specialty business? Just wondering if you know what your oncology share is today versus maybe 1 to 2, 3 years ago?

Yes. It's tricky, Whitt. I mean it's a great question. And we do have some of this, obviously, drug by drug. As we talk about a lot, a proxy would be generally half of the revenue of specialty drugs go through the SP channel. And then what is your share from there? We do feel that our share continues to increase almost by definition, if you're an exclusive with a manufacturer or in an ultra narrow network, say, have 2 pharmacies.

By definition, you're going to get 100% or 50%, 60%, 70% market share of that specific drug. So as more drugs have gone exclusive and ultra narrow, just given the service that we've been able to provide, that will pick up your market share. You do have to go drug by drug, ultimately. But if the trend is towards more LDDs in particular, EDs and Altraneros, we would be seeing a greater share there over time. And then on the generic side, we do try to get in front of it. We try to be in the offices well in front of a generic launch, communicating and educating and building out that brand volume.

So I think we'd like to believe our performance on the conversion side is really strong. And -- but we can do a little bit more work on those market shares. You don't have perfect visibility on it, obviously, but we do feel like it is continuing to ebb up.

That's helpful. Corporate cost was up maybe a little bit more than than we thought. I mean I know you guys are making a lot of investments this year. You've been quite vocal about that. Jim, what do you have in your plan for the full year for corporate?

Yes. Great question, Whitt. So if you look at versus Q4, our corporate costs are not up quite as much as they would appear to be year-over-year as we have been making additional investments in different activities throughout 2025 as well. I would say I do expect a small pickup through the remainder of the year as we think about the some additional projects that we have in the pipeline from an IT perspective and other things, but I would say not a significant tick up at this time is our best view.

[Operator Instructions] Our next question comes from the line of Matthew Gillmor with KeyBanc.

Maybe picking up on some of the generic conversion comments. You had mentioned that utilization was strong. I wanted to see if you could provide a broader comment on the landscape for generic conversions and how you're performing relative to that opportunity.

Yes. I would just say, just very consistent there. in terms of the last, really, 5 years, we've got a broad portfolio across drugs and brands and generics across the organization. And so it's really fluid in terms of what's coming in and what's coming out with new brand launches and conversions, the market's real dynamic. But from a generic standpoint, the playbook remains the same. We've continued to invest in the sales force, and we've continued to try to invest in our manufacturing partners as well, not only branded but generic to be able to have access to the supply were needed as well. So I would just say it's a strategy that we continue to try to refine over time. It's multifaceted in terms of being able to execute against it. And as we look out to the next 2 years in particular and then another 5 years, there's still a healthy stream of of drugs that will be coming up on their patent expiration date in converting generics. But we're always looking to grow our product portfolio in the most broad and holistic way possible across all therapy types.

Our next question comes from the line of Brian Tanquilut with Jefferies.

John, maybe just a question on the business, right? As it relates to the defensiveness of it? Or how do you think it could be resilient? I guess, any PBM moves in light of the challenges the PBM industry is facing and also some of the stuff we found out yesterday from your peer, where the PBMs and the payers are trying to move drugs away from non-PV rolled specialty pharmacy. So just curious how you're thinking about the strategy around defending the mode of your business.

Yes. I mean we do as best we can to try to partner with everybody. I mean we have really long-standing relationships and I think healthy partnerships with everybody across the value chain. I mean I think it starts with our quality. We really invest in quality like crazy. I think hopefully, our scale is extremely helpful, too. And look, on the Medicare side, there's rules and any willing provider, for example, but we're big believers that in patient choice and member choice and they should be able to receive a provider that they want. So we try to be a high-quality provider, and we try to provide the best service possible to everybody's members out there.

And I think we try to be really thoughtful about where we participate in terms of what therapeutic areas specifically.

Our next question comes from the line of Larry Solow with CJS Securities.

Congrats also on a good quarter. Just quickly on the pharmacy solutions grew about 25% in the quarter. The kind of midpoint of guidance sort of mid-teens. Is the difference going forward that an increase in IRA and more branded conversions? Or is it a little sense of conservatism? Or what kind of drives a little bit of a slowdown there?

Jen, do you want to hit that?

Yes. So I would say, it really is related more to the year-over-year growth and the quarterly sequential growth we saw in 2025. So really, as we think about the remainder of the quarters, while we do expect sequential growth both in terms of revenue and EBITDA, we see that as being much more balanced in terms of quarter-over-quarter growth.

Our next question comes from the line of Stephen Baxter with Wells Fargo.

I just wanted to follow up on some of the kind of the efficiency conversations we've been having today. I guess, specifically looking at the pharmacy business, you've held a really tight range for the past couple of years. And I think you've gotten leverage on SG&A, I think, in all 20 quarters that we have in our model. So as we look at this quarter specifically, it looks like SG&A stepped up like $40 million sequentially or something like 40% quarter-over-quarter. So I would love to just understand a little bit better, like what is driving that sequential increase? Is there anything has a onetime or kind of unusual to flag? And then just think about what this money is actually being spent on how to think about like kind of the growth profile or the returns that you'd expect to get on this kind of what seems like a pretty meaningful platform spend over time.

Yes. So maybe I'll start and John, if there's anything else you want to add. So from a Q1 perspective, there were a number of investments we've talked about in terms of IT and other areas. Those were certainly contributors from a cost perspective in the quarter. But we also continue to invest for growth in terms of sales force across our different businesses. a number of other areas. So we've talked about as we're investing, we're always thinking about how can those investments drive growth next year and 2 years and 3 years from now. So we did have a number of investments there. There certainly were commissions and other things that related to the strong sales growth in other areas that did drive that. But I would say the largest impact were those investments, including into our sales force and other areas throughout in the quarter.

Our next question comes from the line of Erin Wright with Morgan Stanley.

So you need to belabor the topic, but just since we're getting a lot of demand questions on it, I just wanted to dig into the PBM dynamic, just a little bit more on private label. It just seems more dedicated to subcu. But are you seeing any changes in reimbursement now on the infusion side versus subcu? And when the subcu does launch? And how do you kind of think about the scope of the private label right now, does it broaden at all over time, just given some of the traction that they've seen so far? And I guess, how do you think about the relationship with payers and PBMs and any potential conflicts of interest that could arise? And I don't think you give a generic penetration rate, but like what percentage of that could be exposed to some of this competition over time? I'm just trying to reconcile with that.

Yes. I think as it relates to any of the private label stuff, we just don't have a lot of volume or exposure to those sort of relevant products or situations today, and anything we're seeing or experiencing from a payer or PBM standpoint, I'd just say it's very consistent. We're not seeing any big changes or big moves as it relates to our agreements or our products.

Thank you. Ladies and gentlemen, I'm showing no further questions in the queue. That concludes today's conference call. Thank you for your participation. You may now disconnect.

[Presentation]

Good morning, everyone. Thank you all for joining us here at BrightSpring's headquarters in Louisville, and welcome to those of you who are on the webcast. Today's agenda will start with a company overview from Jon Rousseau, Chief Executive Officer; followed by detailed reviews of the pharmacy businesses from the leaders of specialty, infusion and home and community pharmacy. Following the pharmacy overview, we'll bring up the leaders for question and answers before we take a break.

After the break, we'll go through the provider businesses, starting with home health, hospice and rehab and personal care, followed by a Q&A session with the provider leaders before breaking for lunch. After lunch, we'll hear from the leaders of government relations and business development teams, followed by a discussion on the company's financials with a wrap-up discussion and Q&A with Jon and the other leaders. Our goal is to end the day around 2:00 p.m. Eastern.

Before we begin, I'm going to read the company's forward-looking statement. Today's discussion will include certain forward-looking statements that reflect our current assumptions and expectations, including those related to our future financial performance and industry and market conditions. Such forward-looking statements are not a guarantee of future performance.

These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from our expectations. We encourage you to review the information in today's presentation as well as in our annual report on Form 10-K that is filed with the SEC including the specific risk factors and uncertainties discussed in our Form 10-K. Such factors may be updated from time to time in our periodic filings with the SEC, and we do not undertake any duty to update any forward-looking statements, except as required by law.

During today's presentation, we will use non-GAAP financial measures when talking about the company's financial performance and financial condition. You can find additional information on these non-GAAP measures and reconciliations of our non-GAAP financial measures to the most directly comparable GAAP financial measures to the extent available without unreasonable effort in the company's 10-K. This presentation is being recorded and will be available for replay on our Investor Relations website.

And with that, I will now turn the day over to Jon Rousseau, Chief Executive Officer.

Thanks, David. Good morning, everybody. Is this thing working good? You guys can hear me? Good thing I can't see so well. Good morning, and thank you for being here. I appreciate everybody traveling. And for those that were able to get to walk through last night over at Onco and CareMed, hope [indiscernible] the great things that the organization there that.

All right, with that, I know we've got a packed schedule, we will dive right in. I'm going to hit just an overview for about 20 minutes, then we'll hit pharmacy the provider side, and then we'll wrap up with some core debt and finance, if that sounds good.

If I can figure out -- the clicker. Okay. Well, look, I think a lot of you are very familiar with the story at a high level, but I'll reiterate it. We are a leading home and community health services company, full stop.

Whether it's pharmacy services in a closed door manner directly to the patient or whether it's provider services, going where the patients are, we are a solution for the future of health care, where we deliver very high-quality products and services at a lower cost for a very high ROI. We think that's a very good place to be aligned with long-term health care trends. And we want to ride that out as far as we can and continue to be an innovator and a solution provider within health care.

So again, we primarily take care of seniors and specialty populations, providing them with very needed solutions, which are also lower cost. In doing so, we really focus on the platform and our quality and operational capabilities. That's really been a hallmark now for 9.5 years that we've invested in, process, people, operational excellence wherever we can, and that drives our growth.

The quality of reputation and our ability to get services out the door quickly drives our growth. Ultimately, we also have a lot of scale advantages with this platform, which I'll talk about more, sometimes I think that's a little bit underappreciated. Yes, we have a lot of service lines that are doing well, and we are defined by broad-based growth with a few superstars in our portfolio from a growth perspective. But I also believe that the reason why we've been so successful, we're in the top 5%, 6% of public companies in the last 3 years on EBITDA.

In the Russell 3000 for companies over $5 billion or $10 billion in profitable, we're second on revenue growth over the last 3 years, right? I think the reason why we've been able to do that is because we have the one enterprise platform.

So a little bit on our history, ResCare, our predecessor company and brand goes back almost 50 years founded here in Louisville, taking care of individuals with intellectual and developmental disabilities in group homes, just an unbelievable mission. That company has grown its revenue for about 30 or 40 years in a row consecutively an incredible quality that leads that industry.

When I got here about a little over 9 years ago now, we started more heavily investing on the clinical side. We also had a pharmacy business, taking care of those individuals in the home very smartly. We had a rehab business, personal care, but we really started building out more of the clinical side with some of that -- with some of my background in a earlier in the areas, that went really well.

Had been in the company for about 15 years, taking it private. We recapitalized to KKR about 2.5 years into that, a little bit sooner than we wanted to, but Onex literally had to exit. KKR has been incredible and wonderful partners throughout. I mean, their focus on quality, their focus on mission was just ideal for this company. So that happened in early 2019, and it's just been an incredible run.

Our thesis then was to combine a large pharmacy company of scale, PharMerica, which they had bought about a year earlier with our provider scale and create a very unique platform within health care, a very unique, scaled pharmacy and provider platform that could more comprehensively serve patients. And that has gone extremely well. Fortunately, that headquarters was about 4 miles down the road on the PharMerica side and very seamless for us to all come together.

So after that, it's really been about 7 years at this point of just execution and building out the platform. We had the service lines we largely wanted to be in, and it's been growing in those service lines on the back of our quality and operational skill set, which has been the focus for the last 6 or 7 years and has resulted in those growth rates that I spoke about before, CAGRs of around 20% at this point on both the top and bottom line.

We've had some events now in the past couple of years. We went public in January of 2024. So it's been about 26 months now. And that community living business, which we started with about 50 years ago, we decided late January of last year to divest that business to have a strategic focus on more clinical services in the organization, also helpful from a deleveraging perspective and a cash flow perspective. So again we expect that to close here in the next few weeks.

We've also selectively done some acquisitions, with these home health assets here more recently, which we think that will be very favorable for the company. So our model today, the circle, the top half is pharmacy. The bottom half is provider. And we think those fit together extremely well. It is a comprehensive in what we believe to be a very differentiated model for home and community health care services that better addresses required patient needs for improved outcomes, it creates market and integrated care opportunities, and it leverages our scale.

So I think everybody is probably pretty familiar with some of the challenges and opportunities in health care. I think the left side of this slide is very self-evident. But there is a smaller percentage of the individuals in our society that make up a larger proportion of the spend. It's individuals on -- with chronic conditions, seniors and specialty indications. One of the markers of these populations is that most people is typically on 6 or 8 or more medications.

When you look into health care and you see an individual who's on 6 or more medications, in particular, that's referred to as polypharmacy, mean that is a pretty clear indicator of where your biggest risk is going to be and where your most complex patients are. A lot of these individuals could be served in lower cost settings, very logically. And a lot of ER visits and hospitalizations could be curtailed with more proactive and more proximal care for these patients where they are.

So our solution to that has been the integrated care model. These services are delivered in lower cost settings. We've been able to deliver very strong quality results. The comprehensive model does give us a lot of integrated care opportunities, whether it's cross referrals across our service lines or ultimately managing patients in more value-based care models.

This model, we believe, again, is the future of health care in many ways in what we need to keep driving. So what constitutes that model more specifically from a product perspective, on the pharmacy side, we have 3 key service lines. On the provider side, we more or less have 3 key service lines. So I always keep it straight in my head with kind of a 3 x 3 framework, if you will, on pharmacy.

This is closed door pharmacy, okay? And that is the big difference. This is not you and me walking into a retail pharmacy. It is the polar opposite of that. There are a myriad of settings and locations in our society and neighborhoods every day where people need their medications where they are more chronic, more acute where they can't walk into a Walgreens for one script.

That doesn't work for a large chunk of our population. So we go to them. That's what closed door means. You cannot go in, we go to our customers, we go to our patients wherever they are.

The first patient population that we do that for are individuals with cancer and individuals with rare orphan diseases. That's our specialty pharmacy business under 2 brands, Onco360 and CareMed. Onco360 as the name might indicate is our focus on oncology. CareMed is our focus on LDDs and rare and orphan therapies outside of oncology, and that continues to grow.

That is a leading quality business in the United States with excellent service metrics, Net Promoter Scores of above almost 95. And on the backs of that, the team has developed incredibly deep and trusted partner relationships with pharma over the years, and our sales team really pulls through as a partner in the offices every day, prescriptions, working with patients and families.

Our infusion business, this is going to the home or sometimes in a suite or in the clinic in providing needed infusible therapies. We really do everything there. It can do everything in infusion, except oncology. Specialty business I talked about before is oral and injectable. This is infusion.

And we do most things except oncology, which is primarily done by the hospitals and the doctors in the buy-and-bill model. So in infusion, there's 2 key areas in patient population types that we focus on. It's our acute patients, antibiotics, nutritional therapies, et cetera, and then the chronic specialty population, IVIG, a lot of neuro and gastro indications et cetera. Wonderful business, large market growing.

Our home and community pharmacy business. This is more or less the biggest legacy business of PharMerica. So this is where we are getting drugs and medications to hundreds of thousands of people every day wherever they may be. These are individuals, again, that are more acute with chronic conditions in skilled nursing facilities and assisted living facilities at home on hospice, at home on home health in behavioral group homes.

This is a good example of where we have integrated care in our company. All of our hospice patients, all of our behavioral IDD patients also receive all their pharmacy services from us. But collectively, across these pharmacy businesses, we dispense over 40 million scripts a year, I think that puts us in about the top 10 of the country as a pharmacy after the retailers and after the big PBM mail order houses.

Scale is very important in a lot of industries. It is absolutely vital, as Scott will talk about, in the pharmacy industry for purchasing, for payer contracting, for leveraging your OpEx for driving automation, pharmacy is just critical. We can be anywhere in the United States on the ground within 3 hours. That's our coverage, and that's our footprint that's been built up over the past 40 years, and it's a huge advantage.

On the provider side, home health care, rehab care and personal care. Home health care, that's home health and hospice, and we're building out our home-based primary care business. We'll talk more about that. We're integrating presently the home health assets that we acquired in the United divestiture of Amedisys.

That's going very well, but we love those businesses, huge ROI of home health, produces hospitalization rates by 20%, 30%, reduces cost the same for hospice. These are wonderful services with very mission driven clinicians who are out there every day, taking care of people in their home so that they don't go to the ER unnecessarily or they don't go to a hospital more than they have to.

It seems incredibly intuitive that the more you get to somebody proactively in their home, see their setting and make sure they have a customized care plan, like that works. I remember like 15 years ago, somebody told me there's not a lot of new ideas in health care. It's just the implementation and the execution of it.

And a lot of these things are very clear in terms of what you should do. It's the ability to actually do it, and it's making sure that you have a reimbursement model that supports it. On the rehab care side, wonderful business with incredible clinical quality. Here is where historically, we have taken care of individuals with severe neuro conditions, either a brain injury or a spinal cord injury.

It's mostly a workers' comp and in a commercial funded business, where we have a footprint across about 30 states, very predictable, nice double-digit growth business. It's about a 7% growth market. We are more recently leveraging that rehab and therapy expertise to also move into the senior setting, adjacent to our home health hospice primary care and pharmacy and be the rehab provider in conjunction with home health in places like assisted living in the home for seniors under the Part B benefit.

Personal Care, very, very steady business for us, 2% to 4% grower, but operationally, very consistent, very steady, it is not the easiest thing in the world to hire caregivers to go deliver personal care, the lesser clinical home instead type services in the home. Our team does that very predictably and in a very consistent manner with really good quality results.

I really think that personal care and med management are the 2 ways if you look at the data, that keep people out of the hospital the most. If you just think about it, when somebody is in the home, you don't have to necessarily be a doctor or a nurse or a therapist to do common sense things at the home.

What are you eating? Are you able to get around? Are there fall hazards in your home? Are you getting companionship? Are you taking your right meds? Any of us can do that. That's personal care. And it has an incredible impact on also keeping people out of the hospital.

Our markets are large and growing, and they're also incredibly fragmented. So we think that creates a lot of runway for us in the future, both organically and from an acquisition standpoint. If you look at our markets, they all have favorable demographic trends. Everybody, I think, knows the growth in the seniors population.

I think people over 85, that population is supposed to triple in the next 10 to 15 years, people over 65, that's supposed to double in the next 30 years. So a lot of long-term growth trends here. Specialty indications are generally growing at about 5% to 7% or 8% in the country. On the pharmacy side, a lot of these specialty therapies have been growing more in the 10% to 12% range. Ultimately, these markets, we believe, are very attractive.

They're also very fragmented. We believe scale is going to only be more and more important in the future. You need scale in these industries to invest in HR, to invest in technology. I mean, Charlie and Viji are going to talk for a second about how we're investing in AI to drive operational efficiency through the organization. Our ability to deliver really good operational services and sound practices should be so much better than a home health company in 3 states than an infusion company in 2 states.

We try to leverage our expertise. We think scale will only be more important in these large and fragmented markets while we also try to partner with the government and with payers on needed solutions. The prevalence of chronic conditions, unfortunately, continues to escalate as well. These are all factors that are fueling the growth in these markets where we want to continue to be a standout provider.

We want to not only benefit from addressing the demand needs in these markets, but also through a differentiated model and better operations, take market share as well. There's just some growth stats here for you. I won't go through all these. It's going to be in your deck. But on the pharmacy side, we see infusion and specialty pharmacy generally growing in the 8% to 12% range.

There are some therapies and indications there that are growing higher than that. There are some that are growing lower than that. Acute tends to grow at 3% to 4%. Other chronic conditions and infusion tend to grow in the double digits. Within specialty pharmacy, oncology is not only one of the biggest segments of specialty pharmacy, it's one of the segments growing the most quickly because of all the innovation and the new therapies coming out of the pipeline that are literally extending life in saving people's lives. And obviously, we have the largest position as the independent pharmacy in that very interesting growth market.

On the provider side, personal care tends to grow at the population growth rate. But home health hospice and rehab are growing in that 5% to 7-ish percent range depending on which one you look at, very healthy growth rates. And the way we think about that is, look, if the market is growing at 5% to 7%, and we need to try to double that, we're taking market share, and that's our approach to try to get to double-digit growth in all those businesses on the clinical side of provider, rehab, home health hospice.

Everything is based on quality, as I talked about before. I think one of the things that collectively our management team is most proud of is what we're doing from a service perspective and from a quality perspective. Again, a lot of pretty obvious comments today, but you literally can't almost do anything if your operations aren't very stable and predictable and if you're not getting good quality outcomes.

For us, really importantly, we try to benchmark everything, and we try to track everything. So we know how we're doing. We try to do that in real time as much as we can with investments for the past 7 or 8 years in all of our data warehouses and reporting suites, so we can see in real time how we're performing and then also how do we go get benchmark data in the industry to really hold ourselves accountable.

On the pharmacy side, I could pick any one of about 20 metrics really that would show really strong and consistent performance, whether it's the predictability of getting our meds out on time, the accuracy of those meds or Net Promoter Scores that literally can be world-class in the mid- to upper 90s.

On the provider side, in hospice, we've been ranked the top 5% hospice provider. Our home health branches, I think about 94% right now are over 4 star our hospice branches are well above the industry average on 4 star. In hospice, we see our patients a lot more, right? If you're a mom or dad or somebody you knew was on hospice. Would you want somebody coming once every 2 weeks? Or would you want somebody come in 4 or 5 times? It makes a massive difference.

We invest in quality, and we invest in service levels. And we think that's ultimately manifested in our ability to reach more patients and make a bigger impact and grow the organization. We've had over 30 articles and abstracts written about our outcomes in leading journals and publications.

I would be surprised if I knew of another company with 1 or 2 or 3 of those. It just really shows and I think, a tangible demonstration of how focused we are on wanting to drive quality and service through the organization.

Slide here on some of our advantages as a one enterprise scale platform. I think some of these things do go underappreciated oftentimes. But there are real reasons why these businesses collectively and why our company together as one does better. First and foremost, probably stating the self-evident here from procurement and contracting perspective, we're able to be much more effective in terms of how we buy across the company.

We are able to leverage IT spend and drive best practices in technology and data and analytics throughout the organization. It's not only the ability to buy that more effectively and save money as a bigger company. It's to make sure that's being deployed through the organization the right way. So each one of the businesses has the right technology profile.

Clinical quality and compliance. We invest heavily, we've got some 250 people that sit topside at corporate, even above the quality personnel in the businesses that are constantly auditing. They are constantly out there teaching and educating across all of our branches and locations. We have a greater ability to invest and deliver those results on the prior slide because we leverage the organization.

Sales and marketing. We try to drive best practices in sales and marketing across every one of our businesses. How are we hiring sales reps? How are we onboarding and training them? What is our sales analytics for how we target our referral sources? What kind of compensation plans do we have in place, rewards and recognition. Just down the list of Sales 101, we try to make sure that, that's very consistent across our businesses.

HR is an area we have been focused on, along with IT, along with sales and marketing at the corporate level, we always aspire to be an HR "academy" company. How -- what is your experience like when you're recruited? How are you onboarded? How are you trained? What is the intranet, what is the internal systems that you're able to use?

What systems do you use every day for your EHR? Is that an easier system to use. Are there career pathways here? What can I do? And these are all reasons why our retention and our turnover has improved every single year for the last 9 or 10 years. And if you look across our businesses, we are typically in the top 10% to 20% of retention as you benchmark us across our industries.

The PMO, that's something that I was very familiar with going back to my Medtronic days, that is a program management office. The way that I like to describe the PMO is they just help make sure stuff gets done. And you have people that are in charge of everything in a business, there is always the need for follow-up no matter what, and things can always fall through the cracks when you're executing on cross-functional initiatives.

The PMO team, we've got about 20 people on that team right now. They are working on over 100 initiatives at a time in this company, helping to make sure those projects are on time and getting moved forward. We have evolved that to take probably some informal process around smart lean process over the years. And in the last 1 or 2 years, in particular, make that much formal in our company.

So we now have individuals and leaders in this company who drive Lean Sigma training, whether it's a white belt or green belt or a black belt, you can get that here at our company, just like at your Medtronic or just like you're a GE in the old days. You can get that here, and we have something like 300 projects going on right now in this company initiated by people on their own in their business, working on how to do something smarter.

So we want people to organically think about what we're doing every day. I've been taught about what Lean and smart process looks like. Now how can I go execute that as part of this training because I need a live project to get through graduation of this training, and I have to demonstrate the execution of a project.

So really, really cool stuff that we get excited about, that's in the bowels of the organization every day, but it's literally how things get done. Really last from an acquisition perspective, we are able to leverage a lot of our size in terms of being able to be selective about our acquisitions, right like we don't have to just pick from home health assets.

We don't just have to pick from infusion assets. We can look at infusion, hospice, rehab, home health, LTC, pharmacy, and we have the luxury of being able to sit back at any point in time and say, which one of those do we like the most, right?

And think about what makes the most sense right now in our company for an acquisition to do. Most of them have been small tuck-ins, but we have the ability to execute on really almost any deal out there with our team and with the synergies that we bring to bear.

In some of the pharmacy deals, day 1, day 2 after close, boom, that financial profile looks very different because of the contracts that we have in the revenue and the cost synergies that we can bring to bear. These are all strengths of the organization that we believe we have advantages of scale driving best practice through the organization that I just am not sure a local or regional provider of one business alone would have.

And so we want to continue to push the pedal down on this as we move forward in the future and just drive more and more scale and more and more advantages of scale with really high-quality services.

Just a slide here a little bit more on the lean process. I mentioned it before. There are over 700 projects in the last 3 or 4 years that our PMO team has completed in procurement or process or technology implementation separate now from all of the organic on-the-ground Lean Sigma projects going on as a result of the Lean Sigma Academy training in the company. This is in our DNA, and this is what drives operational service levels and the quality results that you saw.

Charlie and Viji, did you just want to take 1 or 2 minutes to talk about, we can't talk about all the things we're doing in AI for a few reasons, but we're excited about it, right? And we feel like with a company of our size, a $15 billion company with our resources and our people. Sure. There's going to be some things we go buy, right?

There's already some projects we've partnered with paid for with outside AI vendors to get going. Home health intake is a good example of that. But we feel like we should have the sophistication and the ability to get these AI projects done.

And if we can do that, we're the ones with the workflows and the businesses that the vendors want to get their hands on, so we're doing this every day. We know what the problems are. We know what the opportunities are. If we can develop and leverage all the great work we're doing in tech on the AI side, we think that's probably an advantage for us going forward, probably saves us a lot of money ultimately is more predictable. If we have the team to be able to do it. And so that's what we've been building out.

Thanks, Jon. My name is Charlie Wardrip, I'm the Chief Information Officer here at BrightSpring and thank you all for coming. Like Jon said, we've invested a lot in technology over the last couple of years. We've been able to establish a very sophisticated integrated data and technology platform that not only supports the needs of each individual line of business, but also supports the needs across the entire enterprise.

It gives us the ability to provide integration where we need to and share data across the organization as we feel fit. In order to do that, we've done a few things. We really focused on establishing a very operationally focused platform. We work closely with our operators to make sure we can identify things and solutions they mean and that we can provide outcomes that they need to operate their business.

Also, we focus on hiring the best people. And as Jon said, AI is a big focus that we have in place right now. So we went out and found Viji. I let her introduce herself. She's our Chief Technology Officer, who joined the company about 7 months ago now. So Viji, why don't you just introduce yourself for a second?

Good morning, everyone. I'm my -- I've been here for about 6 months. And my remit is all things technology advancement, including AI, ML and intelligent automation. My background is before joining BHS, I was with CoreWeave, which is a GenAI hyperscaler. And prior to that, I was leading the machine learning fleet for Alphabet, working with 23 internal stakeholders, including deep mind research and ads.

My patient -- my passion is driving innovation to drive better quality outcomes for our patients, while improving revenue and reducing cost and simultaneously improving employee productivity. And we have several AI initiatives across the care continuum that will drive that scale that Jon was talking about.

Yes. And Viji has been able to actually bring a lot of people from the industry into the organization. So we focus on a couple of key areas: hire the best people, to fill the gap. So we have the ability to service these things internally. And at the same time, in order to accommodate scale and time to market, partner with key strategic partners.

So we've engaged like with several partners now that will allow us to drive these AI projects in the organization. We focus on, like Jon said, on about 3 areas. We try to keep it simple at. I didn't realize we were all going to get to 3s today, but we did get to 3s today, and one is we got to provide clinical outcomes, great clinical care. We got to support our clinicians and how they provide the services through the technology.

We focus on revenue generation and how can we support the company and revenue growth through referral management, through effective M&A integration capabilities and other strategies. And at the same time, we focus on like Jon was alluding to, how can we get rid of overhead burden so how can we automate processes that's where we think AI has a tremendous amount of opportunity in the organization to automate those functions for us. So thank you all.

Thanks, guys. Charlie basically hit on it, but these are the fundamentals in the building blocks for IT that we've been very focused on I would call out cyber as well. It's a tricky world out there. And Charlie's background, in particular, deep on the infrastructure and cyber side, it's a huge focus, but really excited about how -- really excited about how technology can help us drive forward from not only an operational perspective, but quality in growth as well.

Look, these are our growth drivers at a high level as we go forward. Each one of the businesses obviously has their top 5 or 10 growth drivers. But when you look in broad strokes, number one, as I mentioned before, we're fortunate to be in markets at growing where we can provide more needed solutions in participating in that market growth rate.

Number two in those markets driving market share through a differentiated capability set and focus on quality and growth. Number three, we continue to try to expand geographically, that is a big opportunity we have in this company. I would say more on the provider side and in infusion and especially in LTC pharmacy, we're pretty much everywhere. There are some markets we can be deeper in home and community pharmacy.

But on infusion, home health and hospice and rehab I mean there is still a good ways to go. I mean I don't even think we're 50% of the way there in terms of where we could be geographically in the next 10 years.

And one of the ways you do that is through just opening up new locations on a regular basis, which we've done, continuing to expand your geographic footprint. Continued platform efficiencies, that's a form of core growth for us as well, continuing to drive the organization as efficiently as we can, reinvesting in IT and in our people and process. So that's core growth. And that's -- these are literally words we use in the company, core growth and strategic growth.

Core growth is how do we take the service lines that we have today and just continue to scale them as best we can. Strategic growth would then be getting into more and more investments, some of the newer AI initiatives that we've talked about before to hopefully continue to transform the company and support scale.

Adjacent provider in pharmacy, patient and payer markets there are numerous patient types and payer types that we could address with what we are doing today. A good example of that is in rehab, where we took our rehab platform in workers' comp and commercial and now we're growing into the Medicare side into ALS.

There's quite a few more examples where we could continue to extend our services into certain patient customer and payer partners, driving additional integrated care opportunities. I'll talk about that on the next slide. But how does the business work together as effectively as possible to provide more integrated care, and then ultimately, from an M&A perspective, continuing to drive really accretive M&A.

So Integrated Care, we're sort of getting to the end here of my section. Again, our focus every day is on core growth, and how do we continue to provide great services in these attractive markets and scale our core service lines. But there are a lot of other interesting opportunities available to us because of our platform. Some examples I talked about before is on the provider side where we provide a lot -- most of those provider patients with our own pharmacy services.

That's just an obvious example of where we are a bigger company from a financial perspective because we are able to offer multiple services to that patient and individual instead of just one, but we think about integrated care in 2 buckets.

On the top of the page, above the dotted line is really how do we better integrate care for patients within our service lines, right? And so as we look forward, some areas that we're most focused on, more and more integration of home health with palliative and hospice, more integration of hospital and SNF discharges into our other service lines.

Our skilled nursing customers in our Home and Community Pharmacy business, we're not the SNF, the customer where we are a pharmacy in that building, they will discharge about 250,000 people a year into the home from those buildings that we service on pharmacy. Some of those buildings we're getting into with primary care. Those are all individuals, 30% to 40%, that will need home health rehab and hospice. That's a huge opportunity from a care coordination and continuation standpoint.

One-stop service solutions into ALS. ALS need home health hospice, rehab, primary care and pharmacy. ALS have to have that. We do all of those. So our ability to be that service provider instead of saying, hey, we're just a hospice over here. Or hey, we're just a pharmacy in these buildings over there. We have the ability to go in as a one-stop shop, and we are really starting to do that more, really led by our home health and rehab business going in and offering one combined rehab solution to that building.

And then really last home-based primary care integration and patient management. We have been building out the house calls model. Wilford Brimley, this is old school, going back to the 20s. Doctors, largely NPEs going into the home or a SNF or an ALF, and they are your doctor. 50% reductions in hospitalizations in that model by the doctor coming to you, right?

And so the doctor is the holder of the pen, they are the ultimate care coordinator, and they can prescribe for the patient what they need. And if we're better integrated with that doctor and if that doctor exists under our organization, that's a nice opportunity to provide services for the physician and for the patient in a better way.

And then there is integrated care from the perspective of value-based care. For us, this would be managing patients in a quality focused manner under a different payment model, where you are compensated for the incredible work that we do in quality and the cost savings that we drive in the organization.

So we think there's 3 fundamental things you need in order to treat a complex high-cost, high-risk patient who's out in the home on their own. How do you do that well? We think, number one is home-based primary care. You need to go to them in their home as the doctor as the NP see their environment and proactively care for them on a regular basis.

Number two, you have to put the meds on lockdown with a medication therapy management program that works. One of the top 2 leading causes of unnecessary hospitalizations and ER visits is medication issues. So our continued care program is a customized program where we can do this for anybody in the United States where they have a 30-day cycle fill with compliance packaging.

They get phone call check-ins, where we provide this service in conjunction with home health, a JAMDA study 2.5 years ago showed a 70% reduction in hospitalization. Like that's just a staggering number. But it's because we really focus on the medication issue, which so often goes unnoticed and underappreciated.

And number three, what do you do with the in-between time? It's great if a doctor is starting to go into the home, but you can't be there all the time. So you need a clinical nursing hub or a way to monitor and be in touch with that patient in all of the in between time. And so we're building out the hub with 8 specific use cases as well.

If we can deliver those services in that comprehensive model to patients, you can have the confidence to be able to go and get paid in a different way or at least be able to appreciate the savings you're generating in an ACO model. So we have an ACO today that's been productive. It's been an EBITDA driver. It hasn't been overly significant.

We've got a couple of thousand patients in it, but that's a huge opportunity to scale in the future. That is a shared savings model with no risk whatsoever. It's literally getting the savings, a piece of the savings that you're driving with your better clinical model. And then what we're trying to do is be an effective partner with the payers, hey, payer, you have 5% to 10% of your members that are 70% to 80% of your cost. We will deploy this model for you with those individuals and get them a much better quality of life, better experience and get you better outcomes, let's please partner together. That's what we're trying to build out.

Wrapping up here from a financial perspective, Jen will hit these numbers in a bit later. But on the revenue side, we have a 3-year CAGR of about 20% now. It's almost the same from an adjusted EBITDA perspective. We were up to $13 billion of revenue at the end of '25, $618 million of adjusted EBITDA.

I think one of the things Jen and I are most happy about or pleased with, in addition to a lot of the quality stuff of the organization over the years is we went public at about 4.6x leverage and that number is now down below 3x. It will be about -- it's 2.6x now pro forma, should that community living transaction close.

In addition to that, we generated about $500 million of operating cash flow last year. You take community living out this year, you put in growth for this year. We expect that OCF number to be about the same in 2026 but we just feel like that gives us a lot more optionality and flexibility as we move forward into the future.

So that's been something that's been really pleasing for us. Jen will talk about how we're thinking about the next -- this year and the next couple of years later in the presentation.

But as we look out to 2028, in our range that we see today, with what we know today, we think this company can grow off of '25 anywhere between 70% to 85% in terms of EBITDA as we go from the end of '25 to the end of '28. That's what we're really excited about. And that would be from an organic perspective.

And so you look at the balance sheet and you look from a leverage perspective, that would be additive. And just very pleased that we've been able to grow into our leverage level and cash flow continues to perform with continued increases in working capital and the CapEx-light nature of our business. That's really it for me.

If I were to sit here and just talk to you for 1 minute about what I think makes us different, it's this slide. I'm going to spare you the details, but I'm sure you'll rush to pull this out after the day and read it for yourself. But really, this is why we think BrightSpring is the difference. And it goes back to what I said before.

We are a home and community health services provider, full stop. We think that is a very good place to be, and we think doing that at scale with the operational quality and sales focus that we have is hopefully going to continue to allow us to grow and move forward in the future importantly so that we can continue making a bigger and bigger impact for so many patients that need these services in the U.S.

So with that, that's it for me for now. And I think we're going to go right into the Onco360 and CareMed team. So Ben and Robert you guys come on up. I probably ate into your time by 5 or 10 minutes. So Robert Thomson is our Chief Commercial Officer for the business. Ben Fernandez, runs Trade, Chris Urban runs all things operations, that is forward.

These guys do a tremendous job with the business and the focus on our patients is always evident and the creativity and the ingenuity in this business, the partnership mentality with everybody in the system has been phenomenal, and we're excited to continue to scale this business not only in oncology, but in a lot of other areas that are defined by rare and orphan disease and LDDs. So guys take it away.

I met many of you yesterday, Ben Fernandez, Chief Commercial Officer. I've been in health care over 20 years, here with Onco360 for about 14, really with a focus on driving access to therapies and our limited distribution portfolio.

Good morning, everyone, Robert Thomson, Chief Growth Officer; I'm in charge of everything, sales and business development included in that is payer sales, physician sales, which is an outside and inside sales team, hospital sales and then also sales operations. And I've been with the company 13 years now.

Nice to see everybody again. Chris Urban, Chief Operating Officer, been with Onco360 for just over 10 years. So for those that participated in the tour yesterday, thank you. Hopefully, you found that just as valuable as we did. So for those that were not there, we are going to start this meeting, like we start all external meetings, and that's to really talk about our mission, vision and values.

Mission, vision and values are not just words on the screen, but they are what we truly live day in and day out with our employees and extended to our patients. So our focus is to improve the lives of patients living with cancer, rare and orphan disease. How we do that? Through our vision, we will clearly demonstrate that in our presentation today. The values. Values are truly embedded in the DNA of each of our employees.

Now one of the really neat things that we do on a quarterly basis, we encourage our employees to nominate each other when they see our mission, vision and values being demonstrated. We review hundreds of nominations a year. And then every quarter, we choose a winner or multiple winners in some cases, when you're reviewing 100.

And we put publications out both internally and externally, celebrating that. And then that winner gets to choose a charity of their choice, and we make a donation to that charity and their name. It's something that we truly believe awesome, and we really celebrate as an organization.

I think we'll see that we're there yesterday, I saw that. So we have had the unique ability to grow both organically with Onco360, but then also capitalize on opportunistic adjacent markets in rare and orphan. Back in 2014, we had 12 sales reps. We had 39 limited distribution drugs. Today, 275 sales rep strong and now over 149 limited distribution drugs.

We also took our accreditations from 2 up to 4 with the key being designations in some of those accreditations for rare and cancer. This execution has really allowed us both Onco360 and CareMed to become the largest independent oncology rare orphan pharmacy platform in the United States.

Thanks, Chris. As you all can see, we've been very intentional and purpose-driven with really an unbelievable focus on driving clinical and operating superiority across specialty with the focus on cancer, rare and orphan disease. All of our focus has historically been around driving an optimal therapeutic experience for patients.

It sounds simple in its message, pretty complex in its delivery. How have we done that? It's been through really investment in infrastructure and oncology. Today, we have the benefit of going to market to support manufacturers across new pipeline innovation through 3 really defined businesses.

In our specialty pharmacy at Onco360, which is really our largest, most mature business within the rare cancer and orphan space. We have CareMed which has been a solution to partners looking to get that same service, quality, performance, innovation, ingenuity out of that they saw in oncology at CareMed.

In addition to specialty pharmacy, separate from the pharmacy business, we have ConnectMed360 that looks to partner with manufacturers and really provide support and services. And all of the programs coming out of ConnectMed360 are really fee-for-service driven through clinical programs, innovation, really providing a lot of bridge free drug support as an extension of the manufacturer partners we support.

If you go to the next slide, we're going to talk you've heard the theme of quality today throughout every interaction, but the compassion really drives all that we do across our care coordinators internally, our account management teams, our sales organization, from a manufacturer perspective, we built a reputation and credibility based off consistency.

While we partner with manufacturers, we're consistently first to market, that's because Robert's team is driving pull-through. We leverage those 250, 275 sales reps in the market to create awareness and access whenever we launch new limited distribution.

Chris' team is operationally ready to launch on day 1, consistently once a product gets FDA approval. That product is not generally in the channel for a period of time. That could be 48 hours, sometimes that can be 2 weeks. A number of our programs, partners' products on the shelf that same day, we're sharing the success, getting patients under treatment.

That speed to market really means a lot to patient, a caregiver could be a pediatric neurology patient that we're servicing. We sell that success of our partners. That continued focus and support really is what fuels our pipeline. We're going to talk a little bit about pipeline and our LD access in a little bit.

Our people are an extreme differentiator for us, right? We have seasoned leaders within the business that have really position us for continued growth, whether it's through new access, our sales organization and our operational leaders.

So guys, this is how we view the business in simple terms. Ben acquires the drugs, thereby creating a differential advantage in the marketplace for Onco360 in CareMed. In doing that, he turns over the opportunity to us by leading sales force around the country, 200 plus.

And what they try to do is create awareness of access with the physicians, educate the physicians create a first mover opportunity and then also just in simple terms, garner referrals. In doing this, one key aspect of Onco360 and what we've built by design is that our sales force is built into Chris' operational workflow, this literally means that they can see the prescriptions as they come in minute by minute by minute and start educating the physicians as it relates to prescription status.

Of course, inclusive of this is the ability to troubleshoot. Should there be any prior authorization issues, medical issues or just more information needed. And then lastly, upon final dispensing of the prescription, they educate the physicians to ensure that the patients who need this therapy in an urgent manner go on therapy and start their...

The last part of this is, of course, to have payer access. So we've got a team of fully dedicated sales folks dedicated to relationships with payers so we can service and have broad network access for all the referrals that the hospitals send to us and the physician send to us because a high percent to fill is absolutely critical in this industry.

And then all comes back down to the patients. Our high touch, white glove service model is really delivering few call-outs here. Obviously, Onco360, Jon mentioned it always in the high to mid-90s. I do not want to steal any thunder, Jon, from when you're upcoming calls.

Well, in Q4 2025, CareMed our rare and orphan pharmacy received a 100 Net Promoter Score, okay? That's absolutely phenomenal. That is their third perfect 100 in the past 5 quarters. So we are so proud of that team, and we're so proud of the service that they're delivering for our patients.

We're going to expand a little bit about what we see on this page here is really the diversity of our manufacturer partnerships, right? You can see a mix of biopharma as well as big pharma. Some manufacturers that are solely focused on oncology, but also others that have a healthy mix of oncology, rare and orphan pipeline.

As we look at the market, we still feel very excited about the growth in the pipeline in oncology. But these partnerships really set us up for success, not only from launching of manufacturers new drug. But oftentimes, when we launch the first new drug, we're getting the next 2, 3, 4 drugs of the manufacturers portfolio.

As you know, there's a lot of consolidation in the marketplace, you'll see pharma acquire different organizations, consistently, our platform is the go-to from a partnership standpoint.

We're coming off our most successful year in company history with 2025 new product launches. And what we're seeing in the delivery in network selection of these drugs is compared to 2019, 97% of the products we're launching today are an exclusive [ royalty on our ] network. The value for that from our team and our program is in those networks, we're driving larger market share.

Robert's team has an extensive portfolio of products that they have as an availability for the offices. Some of the reasons why manufacturers want to select Onco360, CareMed and also ConnectMed in that platform is really driven by the consistency in the operating model.

The ability to know near real time, the status of all of our prescriptions not only empowers them with access and visibility, but ensures we're driving speed to market and confidence in the model. The volume of new products were launched on an annual basis also fuels new patient start growth and volume growth right? So compared to the earlier part of the decade, we're launching over 1 new drug a month in '25, it was 24. We expect that to be very exciting again this year.

Not only are they new molecular entities coming to market, but you also have examples of manufacturers that have broad limited distribution networks or open access drugs that consolidate that. And we had a number of examples of that in 2025. So ultimately creates a more captive market share in audience.

As I look at 2026 and beyond, we're already working the pipeline, 12 to 16 months out, 20 months out in terms of near-term opportunities. A lot of those decisions are already made. We feel very excited about the future and the pipeline of the portfolio. Robert's going to talk a little bit more about that.

So as you can see, over the past couple of years, the momentum is increasing with Ben's ability to garner drugs. Well, we believe the future bodes extremely well for us. Over the next 7 years, you can see on the left, about $100 million -- $100 billion of new product is expected to come to market. And our leadership team feels very, very confident that we'll be within network, if not preferred or exclusive with all of these products.

In addition, there's a unique opportunity in the market. On the right, a significant amount of brand drugs are going generic over the next 7 years, approximately $20 million or -- $20 billion of drug is going to go generic. And of course, our physicians rely on us and our hospitals rely on us due to our capabilities and access, they rely us -- on us for brand drugs, LDDs but also generics due to our capabilities. So we're really excited over the next several years of that conversion cycle.

Next slide. So this is a really important slide to understand how the sales force is configured. Our sales force is configured of approximately 60 teams across the country. I think field sellers and inside sellers combined in a partnership model, where we use data and information, both external and internal to focus on the biggest opportunities in the biggest markets and make sure that we're targeting the right physicians.

Although Onco360 has a significant sales force, we pride ourselves in speed to market. If you think about it, we try to get to the marketplace when Ben wins a drug over the first 24 to 48 hours. What that allows for is first mover advantage, where we're educating the physicians on these needed drugs in the marketplace, but equally as important, it establishes that we can garner any pent-up market demand because these physicians are waiting for these unique therapies in the market.

Lastly, on the right-hand side, we can never forget our existing patients. So our sellers truly are a seller sales and service model. So we focus a significant amount of time working with our physicians on their current patients to ensure that they stay on therapy, talking about new patients that they've referred to us, and so it's really a white glove service model for the physicians in our hospital partners.

Next slide. One aspect of this due to our unique market positioning with Onco360 and CareMed, we formed deep and long-standing direct relationships with PBMs around the country. This allows us to ensure broad network access in both their commercial networks, but also their Medicare networks at the appropriate rates. In addition to the PBMs, we're focused on -- we have a team focused on smaller payers around the country who want to establish a direct relationship due to our product access, but also our operating model, and in many instances, will carve an exclusive out or a preferred relationship where we get to manage all of their patients, inclusive of LDDs brand and generics due to our capabilities.

Okay. So just one more time, I just want to summarize our value proposition for our patients in the industry. So for our patients, it's the reassurance that they're receiving the best quality, the best care based off of the protocols that we have built with our Board-certified oncology pharmacists and also our certified specialty pharmacists.

Access. I think that pretty much speaks for itself, 149 key products key LDD products and growing. Compassionate Care, I mentioned it yesterday, we have 30 what we call onco advocates that are dedicated solely to helping bring down that co-pay and help with funding for our patients. And last year alone, they service 27,000 patients and help them get their medication.

So if you really think about that, if they were not able to do something to help bring down that co-pay, they may have to cut another expense. It could be a utility bill or maybe their food bills. So it's really something that we're very proud of. Time to first fill, the North Star metrics in specialty pharmacy. We're really proud of our 4 days, approximately 4 days for 2025.

And then that is all wrapped together with our IT and enterprise data services team so that we can provide, one, the highest quality data to our pharma partners. We can also provide to our sales and to our physician partners the most actionable updates and at the end of the day, deliver the highest quality care and customer service to our patients.

Thank you very much. And I think we are going to hand it on over to Rich and infusion.

Thanks, guys. Great job. Thanks. All right. Rich, thanks for being here today. So Rich?Denness is the President of our infusion business. Rich and I connected pretty quickly with our shared pharma background. And you don't see that a lot in health services, but Rich has been a seasoned leader of a lot of pharma organizations in the past and Rich had been the Chief Commercial Officer at Option Care as well. It just has a passion for infusion and bringing these products to as many people as possible. So Rich, thanks for being here today.

Thank you.

Green button, that would help, the big one.

Well, thank you all for being here. Welcome to Louisville. I don't live here. So I hope your journey here was as eventful as mine. That said, Jon raised something. It's -- we did share our pharma war stories back in the day. But when I look at infusion and when I look at Amerita, I think of the opportunity to truly build a brand and to build a brand within an industry that is truly evolving every day.

As the pipeline comes out and Chris and team referred to it, the amount of infused drugs in this pipeline, the amount of drugs that have to be administered by a health care professional just continues to grow. It's evolving. It's changing. But I go back to the pharma days when I'll age myself, I was at the Claritin launch meeting, which was about 1937, I think, somewhere back then.

And we became the official allergy medication of Major League Baseball. And I didn't know that Major League Baseball really needed an official allergy medication, but apparently they did. And over time, you saw the pharma industry get more and more heavily regulated because of things like becoming the official Major League Baseball. We have the ability to build our brand here. Super exciting. And I would argue all of infusion has that ability to do it together.

So let me get into a little bit -- here we go, about who we are. Amerita. I would call us a super regional infusion provider. We're not fully national at this point, and I'll get to our footprint in just a minute, but a super regional infusion provider focused on both the acute and the chronic business. I'll probably use the term chronic and specialty interchangeably throughout the course of the presentation.

But at the end of the day, we are involved heavily in both. That is significant because for those of you that follow the infusion business, you know that over the last 3, 4 years, a couple of large providers have backed away from the acute business.

Last year, a regional provider do the same, and we are still heavily involved in both. So we take both of those patient responsibilities very seriously. And at the end of the day, we are committed to the acute and the chronic or the specialty pieces of our core business.

I don't need to probably explain to you who we serve in both of those markets, but I always like in the acute business to riding the tour de France in first gear. You have to be present to win, your feet are moving and the legs are moving 1 million miles an hour, you get home, you rest, you come back to next day and you do it all over again. That's kind of the acute market.

If you're not present to win, if you're not providing world-class service. If you're not timely with great nursing in the home that day upon discharge, you're probably not going to be nearly as competitive.

Chronic little bit different. You have fewer patients, high revenue and basically an annuity business month after month moving forward. We focused, Jon mentioned it earlier, on the neurology and the gastroenterology markets. We're not unique in that section. And frankly, it's our ability to provide world-class service best-in-industry service that makes us competitive in this market.

When we look at the overall size of the business, you can see the market is growing quite well. The 9% really includes the HOPD, the hospital infusion pharmacy department books of business. And then the 11% is the home and the alternate site infusion business.

The -- when you look at the acute business, the TAM is going to be less than your chronic business. That should be no surprise to anybody. And then the alternate site where we are actively engaged and have a full-scale expansion strategy set up is also growing at 9% -- excuse me, $9 billion on a TAM scale.

Where is our footprint? I mentioned we're a super regional. We're not everywhere in the country, but we are strategically located in many key markets around the country. We have a plan to, as Jon said, organically grow where we currently exist and then expand our footprint into new markets. So this footprint, I think you can see will evolve over time, and we are actively engaged in M&A.

Now let's talk about the acute opportunity. This middle section, I think, is the most important on this slide. We currently have the ability to cover 1/3 of the geography in the United States. So 33% is where we have the ability to compete. So clearly, growing our geographic footprint in the acute business is a significant opportunity, and we are currently actively looking in markets throughout the United States where we can grow our acute footprint.

The one thing that I will say when we look at the acute business, we are currently #2 or 3 in most markets where we compete in the acute business. Our market share in acute is growing every day. Our market growth is a very healthy double-digit growth. So we're very pleased with that. And again, 2 out of 3 in 16 of the 18 major markets where we currently compete.

On the chronic side, we focus on about half of the market, the geography in the U.S., the difference is in chronic, as you guys know, you can actually service into other states from pharmacies that are not necessarily located within the state that the patient resides. So we cover or have the opportunity to compete in half of that geography on a national basis.

In pharmacy, our growth strategy is to basically be the fastest, most efficient in terms of getting benefits through the system and getting patients on service. Chris and team talked about a white glove service. We are doing the same with IG. IG is the holy grail of the chronic specialty business. So we are treating that with kid gloves white glove, no pun intended, and we expect to be market leaders within the chronic business.

Reasons to expand. I mentioned the underserved population, the pipeline, our scalable strategy, we have excellent payer access. We continue to work with payers on what we can do to further differentiate ourselves. But the opportunity for us to provide service above and beyond with payers is extremely significant. And you think about it, we spend 40 to 60 hours a year with patients. How many other providers do that? How do we create value and extract value out of that?

When we look at where the clinical innovation opportunities are, Amerita, our infusion services business is very heavily involved in Alzheimer's. We are one of the key providers of LEQEMBI in the country. And Amerita has been selected by Eisai to participate in the Alzheimer's Advisory Board. We're certainly collaborating with both Eisai and Lilly on opportunities to expand our Alzheimer's franchise.

When we look at IG, I talked about our clinical focus on IG, our concierge services on IG and that is underway right now. Our growth in IG has been quite significant, and certainly proud of where we see our franchise going -- moving forward.

And then other limited distribution drug opportunities. We currently have access to around 20 that we are working with manufacturers on in the pipeline. So I'm very, very encouraged by where we're going to go with our LDDs moving forward, and we've got new leadership that is heavily involved in the LDD franchise for us.

Now if you look at -- pardon me, operational excellence, we're really focused on our turnaround times with both the acute and the specialty business. The acute turnaround times are running 30 to 45 minutes, specialty 12 to 14 days. And Chris mentioned a heck of a patient at NPS score, ours are running at 94% right now. Very proud of that.

So if you look at -- pardon me, where we have the ability to invest people, process, technology, Charlie and Viji spoke about our technology opportunities earlier. But we have put in an entirely new executive leadership team within infusion. And excuse me, I'm very, very pleased with where we're taking the business.

The last thing I'd say, is our -- basically, our overall growth drivers, I mentioned several of them, but we're excited about where this business is going to go between the current growth we're seeing in the acute market, where we're going to be taking the chronic business, what we're doing with LDDs, where we're taking technology and what our new leadership team is doing, the ability to build the Amerita brand within BrightSpring is massive. We look forward to it.

And with that, I'll turn it over to Scott?Greenwell.

Thanks, Rich. Yes, the acute business, and Rich, thanks. I know you're coming off of a case of pneumonia. Thank you. Most people would not have been able to do that with your last week or 2. But thank you. Scott, thanks for being here. So Scott joins us most recently from Humana, Scott ran all the pharmacy operations at the PBM there.

I think among many, many things over the years, really building that pharmacy operation out over there in a highly, highly automated way, driving something like $5 cost per script reduction over a period of years that is very hard to do also with exceptional quality. So Scott, we're thrilled you're here. And just like Rich, I wanted to say, Rich has done an incredible job in the last year at infusion really building out a broad team.

If you look at the top 10 leaders in our infusion business, everybody is essentially new in the last year and just a, caliber individuals, whether it's sales or operations or rev cycle or specialty and LDDs, et cetera. So Scott has done the same really across the business. I would say just building on a lot of the strength we have, but going out and getting the people and the resources to build this out into the biggest and most efficient home and community pharmacy in the country.

So take it away, Scott. Thank you.

Thanks, Jon, and appreciate all your time today. And by the way, happy St. Patrick's Day. I we said that. When I think of St. Patrick's Day, I don't think of snow and sleet in the Kentucky market, but unfortunately, here we are. And I understand some people had some travel issues getting here. But again, Scott?Greenwell pharmacist by training.

I've been with the company now for about 9 months, has certainly been an exciting time to join the organization around the Home and Community segment. And we're going to get into what that looks like here in the next couple of slides. I am going to try today with some time. I'm used to batting clean up. So hopefully, I'll get us back on schedule.

As you can see, BrightSpring and PharMerica has really built a really, really powerful pharmacy platform to serve really all kinds of transitions of care as people navigate through the course of their life between the work that we do in the group home setting and servicing our IDD members to Senior Living under the Senior Living brand, and then one point patient care, our hospice, pharmacy and PBM provider business and ultimately into the traditional skilled nursing business under the PharMerica brand.

But I hope you gather from today, is really around how this business has evolved over the last couple of years, how we're thinking about it going forward and kind of pivoting from a SNF-focused long-term care pharmacy business to really tackling each one of these individual business segments in a unique way.

To do that, take scale, right? We have 4,700 heart beats every single day, working to take care of over 4 million patients across 120 pharmacies servicing 6,500 facilities across the U.S. Those 4,700 heart beats every single day waking up to take care of the nation's most vulnerable patients is our bread and butter.

It is what makes us different. It's what makes us unique. And I'm really proud to be part of an organization driven by such an incredible purpose. My father passed in 2020 of frontotemporal dementia. So I personally know all too well what our patients and their loved ones and caregivers have to navigate as they navigate through the long-term care setting. And one of the reasons why I'm here today is to help make this a meaningfully better process and to offer a different level of care and focus that comes along with that.

As we think about our quality deliverables and metrics, Jon has been incredibly passionate around this. But for me, it's simplified around right patient, the right drug at the right time. We have to get those things right every single time. It is not something that is ever allowed to be off.

And as you can see, by delivering across all 3 of those right patient, right drug, right time, you ultimately get your attention with your customers. And we have an incredibly strong retention across each of our 4 business segments within Home and Community and continue to grow and expand that.

All right. So this is the footprint. Jon's referenced scale, scale, scale. Frankly, this math speaks for itself. 120 pharmacy locations spread across the country. We most recently entered into the Alaska market with pharmacy there. And we are capable of servicing coast-to-coast, any patients need within 3 hours delivery to door. So I think that is a competitive advantage for us, especially in this market right now with the disruption that we'll speak about here in a little bit that has been the long-term care pharmacy space.

Next, strategy. And one of the things I really wish you to take away from this slide in our conversation is that this is not the PharMerica of old. This is a new PharMerica. This is a PharMerica that is not trying to stick a round peg in a square hole of skilled nursing facilities and capabilities into the IDD, a senior living/assisted living marketplace.

We are focused now around core general managers for each one of these businesses, focused on the unique sets of needs and skills for their respective businesses and aggressively targeting growth across each of those. We have a leading sales team across each of those 4 business segments, aggressively targeting, leveraging our sale collectively to figure out how can we continue to grow double-digit growth across each of those 4 segments.

This is a new PharMerica that's backed by a tech stack that Viji and Charlie referenced earlier that it gives us the ability to leverage our national scale and footprint, but to deliver a local unique customer service model that makes it feel again very local by leveraging our account management teams and capabilities powered by the analytics and data that come along with that.

Ultimately, to get to a $24 billion addressable marketplace. We are trying to rethink how we service these customers. Again, unique to each individual business segment. Part of that comes to also rethinking our clinical capabilities through formulary management, utilization management, particularly in the skilled setting, trying to think through how do you take traditional PBM tools to leverage total cost of care and optimizing clinical outcomes at the most appropriate cost.

This is not something that as an outsider coming into the space that we've seen with the collective industry and one that we believe there's a very real opportunity to differentiate strategically for PharMerica against everyone else and to power the growth that we've been referencing.

One of the keys, again, is around our focus and kind of a new way of how we're thinking about long-term care pharmacy and in the Home and Community segment, is really standardization of processes. How do we take and create a consistent standard process and onboarding experience for each and every one of our customers within their respective segment that allows us to partner with large regional players and national games to make sure that whether it's in a skilled facility, whether it's an assisted community or whether it's an IDD that they experience a consistent onboarding experience again and again and again.

And we have done that through leveraging technology in a way specifically things like robotic process automation and machine learning to make the onboarding process smooth and streamlined as humanly possible.

We have a lot of investments today, trying to automate a lot of the historic legacy clerical tasks that a pharmacy have to deal with, whether it be member load, prior authorization requirements, billing capabilities and order entry within the pharmacy proper -- pharmacies candidly, benefits from having a lot of structured data as a way for us to feed off of, which is highly adaptable to a lot of these new tech capabilities that we're partnering again with Charlie and Viji to deploy, which is going to create a differential experience for each one of our customers that we've not yet seen across the industry. So incredibly excited about that.

And by leveraging those things, we can get to a different operating model in terms of how we think about our operating cost and cost to fill, as Jon had referenced, which is something that I'm incredibly focused on right now is how do we get to a differential to drive truly a world-class experience and operating model.

We're getting close here. Okay. Investments can clearly be kind of summed in 2 different parts. One, again, I've been referencing it automation, automation, automation, how do we leverage automation in a way to streamline and take advantage of the scale that this business offers across our 20 pharmacies and then ultimately to our customer and clinical experiences for our customers.

Way too often our clinical counterparts within our facilities are dealing with being historians of a patient's care navigating through a very bureaucratic process on ordering meds, getting meds, wears my meds, et cetera. I think everyone today is very familiar with the pizza tracker analogy of trying to figure out how do we leverage technology in a way to improve the -- our partner experiences.

So they know exactly where the meds are when they should expect them and ultimately giving them back time to spend it where they should be spending it most, which is caring for the patients that they ultimately are tasked to do and not trying to figure out where their medications are. So we're spending a ton of time specifically in that realm in terms of improving those experiences, again, with Charlie and Viji's help.

And then ultimately, I think we'll probably spend some time at a future meeting talking about the outcomes of the deploying of these lot of these machine learning and robotic process automation tools and how they're evolving our cost structure and how we're thinking about the advantages that will create.

And then last, it's all about growth. I mentioned earlier, we are expecting and trying to drive to double-digit growth across each of these 4 segments, again, backed by the national scale that we have backed by the clinical capabilities that we have backed by the technology and deployment, enabling these things, and ultimately related to a best-in-class sales force that can go back and articulate this value prop, a differential that we're offering to each and every one of our customers. We are now seeing over the last several quarters meaningful growth across each one of these business segments, and we expect to continue to see that. It's an exciting time.

All right. Five keys to our success really is around this high-touch, reliable, and dependable partnerships with each one of our customers. It's a best-in-class clinical capabilities that we have built in the LTC model. It's operating at scale and driving efficiencies, both for our pharmacy operations as well as our clinical counterparts. And how do we return again back operational efficiency time to them in nursing especially when they're dealing with high turnover, nursing environment as well as constant training needs.

And then ultimately bring stability to a very disruptive market that currently is the long-term care pharmacy space, as we look across the market and see some large players and the legacy players having filed bankruptcy in the last year have been very public. We believe that, that disruption creates a very real tailwind for us given our stability, market position and scaled footprint to really take advantage of all of that disruption.

And couple that with some of the things we'll see with the IRA, particularly focused on the small regional independent pharmacies who are going to have to navigate some of the complexities with the IRA that do not have the strength of BrightSpring or PharMerica's balance sheet is going to create another very real tailwind for this business as we think about growth going forward.

Jon referenced this earlier. This organization has curated a leadership team over the last 24 months that takes advantage of the 40-plus years of traditional long-term care pharmacy expertise, but has now coupled that with PBM, clinical and cost containment excellence, modern pharmacy practice at very large scale and highly efficient, coupled with providers and partners that have historically been on the provider side and operators that have a very unique perspective and point of view into the real -- very real pain points that our customers and providers deal with every single day that can help reinform our products and suites and services and how we're showing up to the market.

And really again, this has been a very real change over the last 24 months, and I'm really excited about what this team is starting to produce and how we're starting to think differently about this as a product and a service offering within the suite.

Okay. At the end of the day, it's about winning. We are here to win. We love to win. We are focused on winning. That winning comes because we have 4,700 heartbeats showing up every single day, taking care of the patients, the over 4 million patients that we serve and doing so as if they're caring for their own loved ones and family members. That is the differential. Every single day, every single meeting that we kick off kicks off with a patient story and a patient persona.

So we can continuously remind ourselves why we are showing up what is our purpose every single day. We're here to win to help our customers manage their overall drug costs. We're here to help them win related to making them more efficient and operationally effective.

And ultimately, we want to win, so we can win for our shareholders, and the investor community at large, which is why we're here. And that strategic differentiators that I referenced earlier, I think positions us incredibly well to do that here over the coming quarters and years. I think Jon wraps me up. And yes, Q&A.

Scott. Yes. So I think everybody comes up for Q&A. Okay. hey, while they're coming up, I'm just going to just sort of -- there's a lot of slides there. So I'm just going to recap some of the growth drivers for the businesses. Onco, again, this is helpful, everything starts with quality, deep relationships with pharma.

There's a very deep innovation pipeline that still exists today, coming to market the opportunity to partner and bring these new brand LDDs to market, they ramp up over a period of years. So you have this LDD growth that kind of stacks upon itself with launches every year as prior launches are still growing?

Those drugs are pulled through by a sales force that we've heavily invested in. And then over time, in addition to the brand side, you have some brands going generic. And then the team has built out a really strong and rapidly scaling fee-for-service business of data and service agreements with pharma and hub programs. So a multifactorial growth model there in specialty on infusion really got to run those businesses from an acute and chronic specialty perspective.

We are investing in the sales force on both sides of those. We're investing in turnaround time and service metrics to build those businesses out. We have a lot of geographical expansion opportunity, and we're building out suites over time to give patients and prescribers more alternatives on where their patients could be seen in addition to just the home which should give labor efficiencies as well.

You look at home and community pharmacy building on 40 years there and the scale that we have today, it is all about scale and continuing to scale that business as efficiently as we can. There's a lot of attractive end markets in that space with ALF, with behavioral, with hospice. PACE is emerging for us and then you've got the historical skilled nursing channel, which is very healthy today.

Look at some of the skilled nursing pharmacy companies out there today, and they are very healthy. So a lot of very attractive growth markets for home and community health care and how do we further penetrate those with leading services in a very efficient model with automation at its bedrock.

So that's our pharmacy business. Again, we go to where people are hundreds and thousands and millions of acute chronic individuals every day, helping to take care of them better and to try to keep them out of the ER or the hospital and give them the better quality of life. So with that, happy to take any questions on the pharmacy side. Brian, maybe you want to go first, I saw your hand quickly.

Brian Tanquilut from Jefferies. Ben, just for you. So when I think about the successes you've had with LDDs and bringing those in. How do we think about translating that to the opportunity in generics? Or maybe asked differently, how do you drive market share with these new generic introductions coming out?

Yes. I'll take the first part and then Robert will probably expand on it through the sales force. So our focus really is multifactor, right? So we want to launch -- be a part of the pharma when we're launching new therapeutic products coming to market. When we do that, and we're 1 of 1, 1 of 2 multiple SPs, we're consistently driving larger market share than our competitors.

That creates really an advantage for us as we think about the pipeline. As organizations manufacturer looking at getting in the space. Onco360 is embedded in a lot of those relationships. Robert seems focused on pull-through. We want to drive new patient starts and then retain them over the life cycle of that brand when that product brand goes generic, the larger the market share we have when that product spread, the bigger the opportunity is in that respect.

When you think about pharma, I would just add, you think about when the drug was generic, the pharma sales force and the detailing just completely goes away. So that's where Robert and his team becomes very effective working with prescribers and patients to still be there as a supportive educational resource for the offices at that point in time.

Erin Wright at Morgan Stanley. With the IPO, there was that significant opportunity to also kind of better integrate the businesses in terms of pharmacy provider. You talked a lot about that in terms of that one-stop shop. But what has surprised you? Where does that stand relative to a couple of years ago?

And I guess, for an analogy, like what inning are we in on that front in terms of that sort of overlap? And then one more pharmacy specific question, just on the $100 billion of new products that are coming to market that you mentioned. I think that was just oncology, if I read that slide correctly. What about rare and orphan. Can you talk a little bit about that size? And then also the relative growth rates across our rare and orphan and then versus your or your Onco360 business?

Yes. So maybe I'll go first and then Ben or Rob speak to the rare and orphan and the LDD or Rich chime in, if you want on that? And maybe just characterize some of the rare and orphan growth in the portfolio. But as it relates to integrated care opportunities and care coordination opportunities, that continues to be a really big opportunity for us. It continues to evolve in new opportunities present themselves seemingly on a regular basis.

We have tried to be careful not to let that distract from the strength of the growth in the core service lines as well because I think, Erin, as you're saying, and it was a question that we got repeatedly in the IPO. I think people look at the uniqueness of the platform and the integrated care services that we have and the immediately say, well, that's different and that's unique, and that seems like a really obvious opportunity to combine all these services, that's a good idea.

We wanted to make sure that we also didn't lose the attention on, well, hey, the core services themselves are in great markets. They're executing really well. So we view the integrated care opportunity, what I referred to here today is strategic growth as just really additive to the core growth. And hopefully, it's a lot of really interesting upside in the future, which would be great for patients and the system. So I gave a few examples of those today.

I mean I do think we are in the second inning. And what we have found is that -- you really do need to and like this is not rocket science, you really do need to resource things in an organization for them to move, particularly when they're sort of in the gaps in between service right?

Ben Robert, Chris, Rich, Scott, I mean they have a day job, Elizabeth, Rhonda, Jay and Hospice Home Health, they have a day job to grow their business as much as we can. Now they're also thinking from an enterprise perspective. But what we've done in the last really 6 months or so, we're starting to build out a team. We hired a gentleman, Scott Hawkins, who's terrific.

We're starting to build out a team that just focuses on these integrated care opportunities more. We're also continuing to resource that primary care team. There's a new leader there in the last year. We hired a CMO there in the last 7 months. We just hired somebody to drive payer contracting. We're continuing to resource the payer, private the primary care team.

So with that focus from a resource perspective integrated care and growth in primary care, we expect to see these opportunities continue to present more growth and then more revenue and EBITDA as we go forward as well. So a ton of opportunities. And frankly, I think sometimes it's a situation for us where there's a lot of good stuff going on. And we don't want to shortchange growth in infusion, growth in home health and get distracted too much.

So what we've tried to do for these strategic growth areas, which I think are really unique to our organization, we've tried to resource them appropriately in the last year and be really sober and thoughtful about needing to do that, so that hopefully, in 5 to 10 years, you're getting 9 figures of EBITDA from these areas, and that's what we're focused on now.

So maybe, Ben, you can start with the second and third parts of that question.

Absolutely, yes. As we think about the pipeline, from our perspective, oncology still kind of over the next 5 years, still remains probably 70% of where the innovation and biggest opportunities are going to be from a growth opportunity perspective, we're out there 16, 20 months in advance. If you think about the life cycle of when they start to make pharmacy network decisions, distribution decisions.

Sometimes that doesn't start until about 16 months when they're really thinking about access. And so we're typically right there. A lot of those same manufacturers that are launching products in oncology there's a segment of the portfolio of very targeted therapies with like rare cancer, patient population, that's in that number that we described.

And then rare provides really a lot of opportunity as well, probably 30% of the other segment of the market comes from a rare orphan disease. A lot of the activity today that we have around non-oncology products. It reminds me of where Onco360 was maybe in 2018, 2019, right? There's a lot of conversations around our support system and transferability from oncology to rare.

If you think about the programs that we've developed with pharma to support cancer medications. They're not only product specific, they're product indication specific, but then implemented, we talked about the infrastructure, the technology that overlays our operating model these are really patient dedicated programs that the business is managing at scale.

That transferability into rare disease, which is a more fragmented market from a physician perspective, from a product perspective, a lot of the work that we're doing there early on is whiteboarding with pharma to create and develop solutions for those patients and caregivers across the pharmacy space but also as you think about the Amerita team medical benefit and being able to provide support and services in the home.

A.J.?

Just maybe a couple of questions about PharMerica. There's been a lot of disruption on the competitive landscape over the last few years. Is that mostly done? Or are there still chunky opportunities for you to gain share vis-a-vis players that are struggling? Additionally, I guess, when we talk about AI opportunities, it seems like to me, ambient listening with consulting pharmacists is they're going around doing charting. Are you doing that? And how big an opportunity might that be?

And then I'm going to throw one more in there. In terms of your other businesses, is there leverage because you have access to a unique population in the PharMerica. Is that a selling point for you in these specialty pharmacy businesses that you're able to use?

Scott?

So great questions, A.J. So -- so first, PharMerica and opportunities there. We do believe that there are very real opportunities in the traditional PharMerica SNF space for us to continue to take advantage of given the disruption that you referenced. I'd love to have a crystal ball to try to figure out within the IRA for other pharmacies that do not have the same size and scale and, frankly, ability to contract with PBMs to offset that, that there'll be continued offset of that.

But I think we're all kind of watching waiting lens of where that ball ultimately drops. But we do expect there to be opportunity there for us for as well as we're also trying to think through a repositioning of SNFs, almost this lens like a Part A PBM and how do we really think about drug cost management in a different way for the SNFs during that Medicare Part A stay and help them inform their budgets and spinning projections for months and quarters out like a traditional PBM model would in the commercial market space.

So I do think there's a very real opportunity for us to continue to deepen our penetration in the SNF side. On the -- I think AI was the next piece of it. So incredibly excited about that space, especially using AI as an enhancement to our clinicians and to really do a couple of things.

One, help us operate at scale and to think differently about how we can solve complex Medicare problems and challenges in a more efficient way by leveraging AI capabilities to help offset just the traditional reading the charts, finding medication opportunities, classifying those types of things. So those are all things that we are actively working on today to help enhance our model, and we'll make into more detail around that as that comes to fruition.

But I do think that's a space across, frankly, all the medical landscape that's really going to be a powerful tool for clinicians to take advantage of and an appropriate safe manner truly as an enhancement tool.

Your third piece, maybe talk about Blake, how we're...

Yes. So on the specialty piece. So we do have -- we picked up an acquisition a couple of years ago called Blake Rx. Blake is really focused today in a couple of states, literally a handful of states, but it's trying to solve for this unmet need of specialty within an institutional care setting. It's an interesting space.

We do think there's a lot of opportunity leveraging the CareMed in Onco special capabilities within that, within the PharMerica customer base already as well as expanding beyond the PharMerica customer base because it's a -- it's a bit of an unmet need across the industry that no one seems to have taken advantage of just yet.

So Yes, I didn't even mention that before I talk about it....

We actually -- we currently have a process built out amongst all 3 businesses where if Scott's team gets a referral, has some questions. We have it all worked out where it would come over Onco360 or to CareMed to service that patient where we can based off of the payer associated with it. And then it's the same thing.

We get an IVIg or a hemophilia patient from -- that is also on an oncology medication, that is automatically going over to Rich and the Amerita team and then both of those products are delivered to the patient.

I think within the Alzheimer's space, just given where that product is likely going in terms of the impact of that across all 3 of these platforms is a really, really an interesting opportunity we're going to continue to take advantage of.

We really didn't even touch on that before. I mentioned ALF, behavioral, hospice, skilled nursing is the end markets and home and community. The specialty part of that business growing. The team is doing a nice job of focusing on the specialty drug needs of individuals in those institutional long-term care settings. And it's interesting.

I mean, you look at behavioral, hospice, specialty ALF pharmacy within that home community business, skilled nursing compared to those 4 is much smaller. It's been a really interesting -- and that was a business that 10 years ago was all skilled nursing. It's not -- it's a good market. It's just that the business has continued to evolve in really interesting ways, but all of those markets present an opportunity to be much, much bigger.

Charles Rhyee with TD Cowen. Two questions. Maybe first a follow-up to Brian's question on generic opportunity. Obviously, it's a bigger -- everyone's kind of focused on it. Maybe talk about how you are -- you talked a little bit about how you are working to gain share as these drugs go generic, but particularly, can you talk a little bit how you work with or around big PBM-owned specialty pharmacies that obviously would also want to capture some of this generic conversion opportunity?

And then secondly, Jon, in one of your slides earlier, you're showing sort of the ramp of the LDDs. And it looked like, in particular, the '23 and '24 cohorts, were ramping very nicely. And then it looks like the 2019 cohort is now starting to ramp up. Anything particular about those years of LDDs that you'd call out or what's interesting about those and why they're ramping so much better maybe than some of the others?

Robert and Ben, go ahead.

I can take the generic question. If you think about cancer, which we showed the pipeline of the cancer drugs going generic, generally, it's a disease of the elderly. And if you think about the network configuration and the way the industry works, there's any willing provider regulations. So long story short, as long as you can meet the PBM criteria is for access and participation and agree upon rates, which we've got into a good place.

It's then about service. It's service and support and your physicians by choice, have the ability to use whoever they believe services the patients in a better manner, whether it's assisting with funding like Chris said, turnaround time, communication because this is a crisis diagnosis. So absolutely, we compete against the PBMs, but we compete on service, we compete on relationships and support for the patients.

Ben, like different cohorts, different growth rates, all the pens, what's the drug, what's the market?

Yes. So on that side, you're -- we're seeing just an acceleration of new products coming to market from an innovation standpoint, right? So -- but it's not only new molecular entities, as existing products that may be of open access or we call it broader limited distribution networks. And let's call it, 2013 through 2020, most of the limited distribution networks may have been comprised of over 7 pharmacies.

Today, we're seeing 97% of those be 3 or less, right? The 30% of our launches in 2025 having been exclusive. So that creates, obviously, that opportunity from a growth brand perspective. The products that are coming to market oftentimes have longer durations of therapy, because we're 1 of 1, 1 of 2, we have greater market share in those limited distribution networks, the longer durations of therapy also benefit us from a patient retention standpoint.

And those networks shrunk over time, too, some of those early ones, I think?

There's a number of examples. In '25, there was 2 significant products that were open access and now we're 1 of 2 SPs.

And Charles, I mean, we really try to partner with everybody out there as productively as we can. We've had really long-standing and positive relationships with all of our PBM partners, just really aspiring to serve their members and as high quality of way as we can.

And again, we've invested in a clinical liaison team over the past 15 years, that's close to 300 folks every day right now, aside from the hundreds of individuals we have internally interacting with patients every day, but really invested in a field force and team over the last 10 years that we've been growing every single year to be there in prescriber accounts with patients every day, just helping them through their decisions.

This is Joanna Gajuk, Bank America. So Rich, actually, I want to switch to home infusion. So a couple of things there. So first, on the -- over 20 LDDs in home infusion that doesn't sound like you were involved in those. So can you give us a little bit more color in terms of what exactly you need to do to make it, I guess, your presence shown in those LDDs. It doesn't require investment in pharmacies, people, technology or anything else?

And the second question on that map on the regions, are there some markets where you have like your eyes on set and why? Like is there some priority were you looking at this and like, okay, we got to get that market mix?

First off, thanks for all of you putting up with me with my flare on Slide 5. I appreciate that very much. I wasn't expecting that. Two very good questions. I'll answer the last one first, if I may. We have a two-pronged growth strategy that we know is real in infusion. The team is absolutely excited about it. I mentioned earlier, my entire leadership team has turned over. So nobody has been here for more than a year outside of my HR person and our finance person, everybody else that touches the outside world is new.

The markets that we want to compete in, where we don't currently have a footprint, while I won't get into specific markets, think of the states that are highly populated, that aren't on our map, full of health systems, and I know that you are very familiar with the infusion business, where we will be able to take our competitive strategy and compete against other players.

That said, too, there is the chronic and the acute side of it. I mentioned earlier, we are the #2 market share now nationally in acute. We are absolutely convinced we can compete with anybody in that book of business in any state whether we're in it now or not. On the chronic side, on the specialty side, same thing. So the best answer I can give you without giving you specific locations.

A, we are very, very active in looking for acquisition opportunities. We are focusing on high population states. We are focusing on states where our combined experience. Jon mentioned where I came from. We have -- our operations leader is from Coram, our sales leader is from Option Care, we have a trade leader, which I'll get to the other part of your question, who has experience from Orsini, KabaFusion and Sileo. So we know where the opportunities lie, and that's where we're going.

On the first question that you asked, we have access now to 20-plus LDDs per se by definition. Access is one thing, having a relationship with the manufacturer where you're actually working with them is another thing. That's where we need to be. So part of the strategy moving forward is to get heavily involved using some of that experience that I just mentioned from past companies where my leadership team has evolved, getting strategically involved with manufacturers.

In some cases where we have access to drugs, we are rekindling those relationships, because for whatever reason, historically, Amerita did not take advantage of that. So that's a lost opportunity in the past. But moving forward, I think it's a big opportunity for us. Because as you know, with LDDs, there is an opportunity for us not only to successfully service patients, but there are data monetization opportunities. There are outcomes opportunities and there are ways for us to help build our brand, which is our overall strategy. So there's the existing portfolio that we're pursuing.

My head of that business, my -- the gentleman that works for me that's responsible for that comes from a specialty pharmacy background where particularly the lifeblood of what his business did. He came from Orsini. So he has had a very, very good track record historically and he has been very successful in his early tenure here. He's been here about 4 months now, 4.5 months, where he has reestablished I think, our image, our brand, our experience, our approach with manufacturers.

And there are a number of I think, novel, very interesting molecules where BLAs are filed and we expect approvals coming, and you guys probably know a lot of these drugs, I won't get into the details.

But therefore, cardiovascular disease or for diabetes, they're for other things that we are going to have to become involved in as is every infusion provider because the specialty landscape has changed so much on the GI front, which used to be a huge piece of the business. So I hope I've answered your question, but a two-pronged approach on that.

The company was just so focused on acute with its history, historically, and what we're doing today is trying to focus on both acute and chronic and specialty. And you just -- you need to operationalize those 2 markets very independently within your organization. And I think that's what the team is doing a good job now trying to focus on.

Dave Larsen with BTIG. Can you talk a bit about a day in the life of your sales rep, like you got specialty, you've got infusion, you've got home and community pharmacy. What is this sales rep doing all day? Is that person representing all of these different business lines? How is their commission determined? Are they calling on dock offices or hospitals or SNFs or all of the above or health plans. Can you just describe that, please?

Can I hit that just upfront real quick to set the table, and then we'll just go to 1 to 3. So Dave, I would just say 2 things upfront. Number one, I've been at multiple organizations, leading health care companies over the past 15 years. It is always a question as to whether or not you have a sales rep sell the whole bag or a suite of services or just their own service line or a product.

Let's say, we have 4 reps in Boston, and we have each selling -- and we have 4 products at the company. Should we have 4 reps that are selling each product? Or should we have 1 rep there selling 4? Our experience time and time again, has been unique focus. You are always going to have something that's left out. If somebody is selling multiple pieces, and so we have made the decision, again, which I think is the right one, is to have focus sales reps, focused sales reps in our businesses to be much more productive.

Now if we can share relationships, if we're swinging by another doctor's office, when we're at that hospital, if we're passing along referrals that come up, that's fantastic. But number one, principally, we want focus I would say, number two, in our company as you look at the call point, it's either B2B or more of a, call it, pharma medical device sales point, where it's a hospital case manager, physician or a doctor's office.

So home and community would be a good example, where it's all B2B. We are working with the assisted living facility CEO management team to win that contract for the chain. That's the way it works largely across home and community. In most other parts of our company, you have an individual clinical liaison going out there every day, whether it's home health, hospice, infusion or oncology and they are individually meeting with a case manager, a physician in the hospital or in an office to pull that individual referral through, and it's more of a "retail" model.

So Robert, and Rich and Scott, maybe you can just hit anything more about what the sales reps are doing, who they're calling on.

So I can go through the specialty side of the house, Onco360 and CareMed. We have 2 different types of sales salespeople, a field rep, which think about traditional pharma. They're going into doctors' offices, educating the doctors, the nurses, the oncology coordinators of our drug access capabilities giving potential patient updates and they're going to see in certain metro areas, various hospitals around the country or actually around their region and then they move on and they do that all week long to go interact with the physicians.

The inside sellers, which are partnered at a regional level with the field sellers. So the strategy is aligned, the message is aligned the targeting, they're behind a computer. They start the day with data and information, literally the night before. They have information on what referrals came in the day before, so they start to follow up. They start the education, they start the troubleshooting if necessary, and then they're working in conjunction with the field sellers, to make sure that they're on 1 page as it relates to physician offices, next step, strategies, opportunities, long story short, over the past couple of years, we've shrunk territories.

Chris showed that we've gone from 12 reps to 275. In shrinking territories, you can service more accounts. You can touch more accounts more frequently. You can provide better service updates. So in the past, we might have had very expansive regions. Right now, they're smaller regions, so we can see the doctors in the offices more frequently, and generally, with the relationships, the sellers that are there most often providing real value to the doctor's offices when as it relates to where the doctors choose to send referrals.

And then as far as the comp plan, we have a comp plan that rewards mix, making sure that there's a healthy mix of both brand and generic drugs, but then also you're comping as it relates to growth. New patient acquisition because that turns into prescriptions and those who have the highest success rate as it relates to growth and mix are rewarded accordingly.

Okay. So in infusion, we have 2 sales forces. We have an acute sales team and a specialty sales team. We have data that allows us to segment our customers and quintile them, Quintile 1 through 5 based on where we see the potential. So the data is heavily utilized in terms of call planning and things of that nature. We go with a 4-week call plan, that doesn't mean we just see somebody every 4 weeks.

We may double down. I may see you every week if you're a quintile 5. I may be there so much that if you repeat back to me what I want to say to you, I feel like I've done my job. So that's the way that we operate with the acute and the specialty team.

The acute team is focused on health systems, hospitals and getting referrals for those patients that are discharged from hospitals on a daily basis. It is -- I mentioned earlier, it's like riding the tour de France in first gear. You have to be present to win. Because if you're not, the case manager needs to get that patient service by somebody, and you've got to be there.

Now the better job we do at providing service, the more we are front of mind and that case manager knowing and building a relationship with our seller will reach out to them and say, I've got a patient who we want to discharge a day, they need daptomycin, blah, blah, blah, right? So that's the way we operate on the acute side. There are 2 roles in the acute business.

There's the account executive whose job is -- we just use the analogy of the hunter and the farmer, the account executive is the hunter. They're building business in health systems or in hospitals. We may already exist, and they're expanding that business, but their job is to grow the business. We have clinical liaisons that we refer to as the farmers who are there to maintain the relationships, to put out any fires if there are any but they really are the liaison between the patient, the referral source and our pharmacy.

So that's how the acute business works, and I'll get to how they're paid in just a second. On the specialty side of the business, our folks there are calling typically on large neurology and gastroenterology practices. In some cases, there are other specialties that are involved, rheumatology, if you're dealing with gout or KRYSTEXXA or some of the chronic inflammatory diseases. Ophthalmology, if there's an opportunity with TEPEZZA and our partnership with Amgen, which goes back to your question earlier.

So -- the specialty team has a very, very clearly defined target audience that they call on as well. Again, 4-week call cycle. Their job is to be the frontline representation of the Amerita brand and to get referrals from those physicians for basically the target opportunities that we showed on the slide earlier. So in neurology, it would be IG, it would be multiple sclerosis. It would be drugs that have to be administered by a health care professional.

A lot of those are for the emerging market in generalized myasthenia gravis. You see the TV ads all the time on TV. So we're involved in neurology in a heavy way. And in gastroenterology, with all of the drugs that you all know. The REMICADE, the biosimilars, the SKYRIZI is no longer the STELARA, but at the end of the day, there's plenty of opportunity there as well.

We are seeing a shift in our focus is becoming more neurology-focused than gastro-focused quite frankly. How they get paid? Everybody has goals and quotas and on the acute side, we get paid based on the referral or the admin -- not the referral, but the admit, the start, whatever terminology we want to use where a patient is actually put on service. Our focus is on antibiotics and TPN as is pretty much every other acute providers focus.

So they get paid on their ability to attain goal or exceed goal there. Same thing on the specialty side. It's a start-based compensation plan. We don't make money on referrals, right? So that's -- the other -- the last thing I'll say on that is the sales team's ability to partner with our pharmacies to make sure that referrals are as complete or clean as possible, so we don't have to keep going back and forth to the referral source.

That is critical. Those criteria that we put on the slide earlier, we show 12 to 14 days to get benefits through on a specialty patient. That's pretty darn good. We want to get it below 10. We show 30 to 45 minutes on the acute business. We'd like to get that way lower as well, but it's progress and it keeps us competitive.

Our ability to partner between the sales team and the pharmacy is what keeps the service levels good. And frankly, referral sources don't want you to keep coming back to them. They don't -- they want you to take this case and go get the patient service. So the better we do that, we always say good service begets more referrals, good service with more referrals begets growth, and that's where we want to be. So I hope I've answered your question on infusion.

And then lastly, in the Home and Community space, Jon referenced it. For us, it's mostly B2B as we think about it. I would say, and this goes back to my reference related to kind of the new way PharMerica's kind of approach this Again, we think specificity is a differentiator in how we should think about growing the home and community space. I think historically, we had more of a SNF lead in, and we got sold against by some of the other larger assisted living companies say, "Well, they're a skilled company, wow, would you bother? That's not the case anymore.

And we are showing up in a very specific and unique way and how we're servicing the assisted buildings as well as IDD. It was a specific sales team focused on that. And we're investing on the assisted side in the retirement right, where a lot of these assisted living communities are growing and expanding exponentially.

That is where we are doubling down our efforts to focus our growth in those populations. We do have as you can imagine, some large vertically integrated customers, right, that have skilled assisted living and some IDD communities. We have very clear ways to hand off those referrals as they may hurdle across multiple different settings for an institutional-based customer client.

In terms of pay, it's -- again, we're very focused on profitable business, growing profitable business and making sure that we have customers that can pay us, pay us on time and are good partners for the business, and their comp plans are structured to take advantage.

So even within a home and community, we have dedicated individuals resources by those end markets that are focused on those. And I would say, Rich, the -- with what Rich said about, think about the hunter versus the Gardner, the Hunter being more of an account manager per se, the Gardner being more of a clinician per se who's kind of settled maybe in one location versus hitting many different referral sources.

That's a model that we employ broadly in home health and hospice as well. And I mean, as you step back and look at our company, I mean, we're probably in over 10,000 different offices today across the country with our liaisons. And so that's where thinking about the benefits of our organization, we do try to drive best practice consistency of sales methodologies and techniques throughout all of our businesses, but a lot of folks out there educating a lot of accounts and patients every day.

Jon, can I say one more thing.

Sure.

One of the really unique things about our service providing business is the interaction that our sales team will often have with patients, caregivers and the ecosystem that is treat it. If you're in pharma, you're not dealing with a patient if they get prescribed your drug. You're not. I mean I am blown away at how professional our sales team is as they interact with patients and caregivers on a regular basis to make sure that everybody understands what's happening next.

You get discharged from a hospital and you get told, oh, you're going to be on TPN for an indefinite period of time for your nutritional needs or you're going to need this chronic drug possibly for the rest of your life.

People need professional, I think, compassionate but very knowledgeable folks to support them because our company shows up at their door. And I think that's one of the cool unique things that makes our business very, very special and very, very different from other sales jobs, if you will, that are out there in health care.

Yes. I say this a lot. In pharmacy, I think a lot of people just think about I grab my script and go in closed door pharmacy like we do, serving these populations where they are, there are easily over 30 things we are doing on an ongoing basis, interacting with the patient and with the family.

And that is a huge part of why you can differentiate yourself from a service quality perspective and from a loyalty perspective because you are very involved with so many things along that patient journey and we are who they call.

Break time. Well, thank you guys for that flew, about 3 hours already -- 2 hours. But thank you, guys, for your attention this morning, and I think we've got a little bit of a 20-minute break or so right now, 5 minutes. We got to do some work in these breaks. But yes, it looks like we got about 5 or 10 minutes, and we'll continue the agenda after that. So thank you, guys.

[Break]

Here we got most people back. And we will continue the presentation and discussion. We're going to shift into the provider side of the business now. Elizabeth Robinson, our President of Home Health. Rhonda?Sanders, our Chief Commercial at Hospice, Kim More, Rehab and Personal Care, they are here for the next provider section. So I wanted to say 3 quick things about the provider side of our business.

Number one, it has been a really steady and nice performer for the company for a really long time, double-digit revenue, EBITDA CAGRs going back 5, 6, 7 years now. And I think that's based on the fact that we're in markets that provide a really great service, and they continue to have a lot of demand. And so it's a really steady provider business with an attractive growth profile.

Number two, really underpinning that is a these are good businesses, like these are really good businesses in the company. They're stable, they're consistent. We have really good people in them. I guess it's been almost like 13, 14 years for me in the health services provider world. And I can tell you, being at some pretty good companies that were industry leaders we have excellent people at the top and down through these businesses that we're thrilled about.

And we always have people knocking on our door wanting to come and we're like, well, how do we find a place for that person because they're an A, but we have really good people in the businesses delivering really good quality results. These are just good businesses that we need to keep serving more and more people with these great services.

And number three, there's really a tie-in between the provider services and the pharmacy businesses that our company. Home health is a good example of that. I think we have a slide in there that shows like 8 different tie-ins of home health to all of our different businesses. So there is really a lot of cross-functional work that goes on at the company and they really fit together nicely.

So with that, Elizabeth, you've been a little busy lately integrating...

A little bit.

About 100 branches here recently, but it's going really well and Elizabeth, maybe you can spin us through home health. Thank you.

Thank you so much, Jon. Thank you for that warm introduction. And I am really excited to tell you about what we do in home health. We provide compassionate patient centered care designed specifically for the older adult and the comfort of their home.

Our teams treat a variety of illnesses, injuries, chronic conditions, and we definitely want to progress the patient toward a higher level of independence and produce better quality of life for them. Our primary focus in the home is to make sure that patient can remain safely in their home. At the same time, we want to reduce avoidable rehospitalizations. We provide skilled nursing, occupational therapy, physical therapy, speech therapy, home health aides and social work in the home.

Now in this division, we provide home health services and private duty services in the home. They are different. Home health, we provide intermittent care primarily to seniors. We treat multiple types of patients with a multidisciplinary approach. We are paid episodically and per visit.

On the private duty side, we can be in that home up to 24 hours a day. We treat both the pediatric patient and the adult patient. We are paid hourly, we're in the home for long-term care for chronic conditions such as ALS, cerebral palsy, Parkinson's disease and other neurological disorders. We provide skilled nursing and certified nursing assistants in the home.

So why would one choose home health? Every patient receives a customized plan of care built around their personal goals, preferences and needs. We believe if the patient is heard and involved in their care, they're much more likely to stay committed to that plan of care, thereby improving patient outcomes. We provide support not only to that patient but to the families and the significant others in that home.

It can be overwhelming navigating illness and recovery. So our clinicians, our teams are in that home providing reassurance, guidance and care every step of the way. They can call us 24 hours a day, 7 days a week, 365 days of the year. We also focus on continuously improving our policies and procedures, investing in our staff, education and training and also using the latest and greatest technology to provide effective efficient care.

Our quality is the core of what we do. We strive every year to improve our performance scores. We use database -- we use data. We use feedback, we use best practices to elevate our plan of care and to elevate the care we give. We are committed to innovation with this innovation, we can rest assured that we are producing and delivering the best standard of care available in the industry.

We partner with companies such as Homecare Homebase, Mosaic, PatientPing, CareFlow, Element5, et cetera. Our goal is to improve that patient's outcome with every episode of care.

We believe BrightSpring is poised to meet the demand of the rapidly aging population in this country that will need high-quality, low-cost care. We believe as individuals -- more individuals choose to age in place in their homes, the demand for convenient accessible care is going to rise.

Right now, the home health industry is valued at $119 billion, growing annually at 7%. We believe by consistently improving our quality, we're going to be trusted partners with ACOs, post-acute networks, preferred provider partnerships and also managed care organizations.

We are right now 12 out of 22 states are CON states. We have 181 branches and growing, and we're serving 27,000 patients. 81% of the branches acquired from LHC and Amedisys are in CON states. It is difficult to enter a CON state.

You can do so two ways. You can apply for CON and compete with other competitors trying to win that seldomly open CON. And at the same time, the people that have the CON already within that area is going to oppose you. So it's a long and drawn-out process or you can acquire branches within that CON state.

We are very fortunate in the fact that LHC and Amedisys have achieved some of the highest quality scores in the industry. So we have branches coming over with the same quality mindset as we do. We have new CON states that have been added to our portfolio, Arkansas, Kentucky, Illinois, West Virginia, New Jersey.

We're currently progressing through a very detailed and thorough integration process. Each branch has a growth action plan assigned to it. We will be bringing over $30 million in additional EBITDA. We expect longer upside through additional operation efficiencies and also additional growth.

As I said, quality is front and center. Right now, our 60-day readmission rate is 15.9%. We are improving and being invited into additional post-acute networks. We have developed our own internal OASIS certification process. We're putting every branch manager and clinical manager through this certification program where we pay for their training internally and pay for them to take the national exam. We currently have a 90% pass rate. After all of our leaders progress through this program, we will then begin to invite professional clinicians to go through this type process.

We compare ourselves to the industry using our shared platform, SHP. We are constantly striving to improve, like I said, our quality scores. Right now in patient care, we're 96% versus a national average of 90%. In the rating of the agency, we're 94% versus a national average of 86%. And in specific care issues, we're 94% versus a national average of 85%.

We will continue to focus on our episodic payer mix, we always have. We'll continue down that path. We have been very successful in negotiating stronger payer contracts. We'll continue that path forward.

Right now, our integration and stabilization of our newly acquired branches are of most importance. And we're pleased with the progress to date, which should be completed -- that integration should be complete by year end we are also putting significant efforts towards further automation of our referral and [ central ] intake departments. and we are pleased with their progress.

How do we grow? How do we continue our growth? Of course, we're going to continue to pursue organic growth by leveraging our ability to gain market share in our new and existing territories, and we have strategic plans in place for that. We will also continue to grow through this acquisition. We have strategic action plans and growth plans assigned to every branch.

We will continue to grow through leveraging our ability to successfully stand up locations through de novos. We will continue to build on our de novo strategy. And then after we complete the successful integration of the LHC and Amedisys branches, we will continue to grow our M&A activity with particular focus on CON states.

Thank you so much for your time and attention today.

Thanks, Elizabeth. I'm going to jump in here on primary care. But it's interesting about our home health and hospice business, and we'll hear from Rhonda in a second. That business, when you think about LHC and Amedisys, when they were so public companies going back a number of years, our home health and hospice business is pretty much right at the doorstep of where they were from a size perspective back then.

If you think about the significance of this business, there's really only 2 companies out there, Genesis and their most recent reincarnation in hospice, [ Genesis ], Gentiva and their most recent rebranding back of the Gentiva focused on only hospice and VITAS. Those companies have been around for 40 years in hospice and have very, very large censuses. That's probably out of reach.

But other than that, we will be the biggest home health and hospice company in the United States, and we're essentially there today, and we'll keep that going. But thank you, Elizabeth. Elizabeth is one of the best, most accountable operators I've ever been around and has a ton of history in the industry going back to her Amedisys days.

But primary care, we just have a couple of slides here. For reporting purposes, we keep that within the home health care segment. So that's why that's here today. I think about this more as that strategic growth area, one of them, in addition to our core growth areas.

But why have we been doing this for a couple of years, getting this up and going? Number one is just simply we have access to so many patients, hundreds of thousands of patients a year through our pharmacy and home health and hospice businesses that need better primary care. So there's an opportunity to introduce that into the service lines that we have to provide patients in their home and in ALS and SNFs with a better primary care experience.

The other one is, as we just want to leverage our really strong quality outcomes into value-based care, we felt strongly that having the primary care capability set was important in that. They are the quarterback in terms of the experience and the journey of the patient. And so we wanted to build out that primary care capability, move up the value stream, if you will. And that's been going pretty well the last couple of years.

It's been a grind getting this going, it's been really all organic, but we've continued to bring good people into this business, including, as I mentioned earlier, a new CMO, a new Head of payer partnerships just in the last 6 months, and we're really excited about further scaling this out.

Home-based primary care, either in the home, but mostly in assisted living and senior living and assisted living and skilled nursing; has incredible outcomes, typically a 35% to 40% to 50% reduction in hospitalization, depending upon what you're looking at.

And so what we are trying to do is enter as many assisted living and skilled nursing facilities as we can and service people in their homes to scale this business, both from a fee-for-service and increasingly ACO opportunity perspective, but then also, as I mentioned before, the opportunity to partner with payers and manage their high-risk members.

We can do that by combining primary care with our Continue CareRx model in the home, med management in the home and having an effective clinical nursing hub in the in-between time, and the in-between space, helping to keep people out of the hospital stepping in front of it.

We're in 10 states today. As I said, we're -- we also recently hired a new sales leader for this business. We keep investing in this company and in this business. So we are looking to enter into as many skilled nursing and assisted living facilities as we can as the primary care provider. We want to partner and share leads with our home health and hospice and rehab teams as much as we can to gain access to these buildings, and we want to provide great care.

If you're a skilled nursing facility or an assisted living facility, that primary care capability in your building has a huge outcome on your patients. And so that is vital for you. It's how you market yourself in the community. Do I keep people here longer? Do I keep them in my facility longer, less in the hospital? So primary care is really important for all of these operators out there in the industry.

And then we're leaning into the ACO as well. So our definition of value-based care is really threefold. One of them would be having your own ACO, right? So if these are our own patients that we are the doctor for, right, they are assigned to us. If we're driving really strong outcomes for them, how do we see the benefit of that?

So what we're in today is a no risk, all upside shared savings model with Medicare. There's going to be some new ACO models coming out in '27 and '28. We are going to be joining those and continuing to try to grow the percent of the patients we see that are in a shared savings model.

The second way, as I said before, is to go to payers and use our care management model here to better manage their members with an innovative contract with them that reflects the value that we're delivering.

And then the third way is we have a really small [ I-SNP ] today. That's a special needs plan. That's a managed care plan. It's in 2 states. You have to get these things approved state by state. So we think we can move much faster on the ACO and payer partnership side. But this is a managed care plan in a couple of states where we have a couple of thousand patients in it.

So if we're in a skilled nursing facility or an ALF, for example, we have the ability to treat Medicare patients under the ACO. Or if not, we have the ability to see patients under a managed care plan construct like this [ I-SNP ]. We just want to have a comprehensive solution in alternatives from a value-based care perspective.

So I hope to be talking about this business and this build-out a lot more with you in the coming years. Our goal is to serve over 100,000 patients and more in time. And doing about 300,000 encounters a year today, but we want to rapidly grow this business and we think it has a dramatic impact on improving quality and reducing cost, and it's very, very closely tied into our other service lines as well.

So with that, we will then move over to hospice, and Rhonda Sanders is going to come on up. Rhonda knows the hospice sector about as well as anybody I know. And not only Rhonda, are you terrific from a day-to-day referral generation and sales standpoint, but also one of the best strategic thinkers and partnership-oriented type individuals I've seen in hospice before. So take it away.

Thanks so much, Jon, and good afternoon, everyone. Again, I lead the growth for our hospice division. It's one of the most compelling divisions in our portfolio. Every single person in this room will need hospice at some point in their life, right? So it's a very compelling service, and I'm excited to talk with you about our growth potential today.

So just hospice at a glance, I want to make sure and paint the picture of who we are today and really what sets us apart as an organization.

So from a broad geographical reach, we're in 21 states and 93 locations across the U.S. That sets us up really coast to coast. So we have a great opportunity to go deeper in every market that we're in. Very exciting about the growth potential in the hospice division.

From an integrated service offering, Jon's talked a lot today about our integrated model. It really is a continuum of care. It's making sure that we're servicing patients in a very fragmented health care world. It's very complex. I don't know how many of you have navigated the health care landscape lately, but it can be incredibly challenging, especially for a senior. So our ability as an integrated service organization to create a less fragmented model is a differentiator for us.

So we have our hospice, which we service patients that are terminally ill. Typically 6 months of life is what we're focused on. Our palliative service offering is even more broad. So we're really partnering around advanced illness patients. That's a broad scope.

Today, we service over 3,000 patients with palliative, with about an 80% conversion over to our hospice at some point, really focusing on right care, right time. We focus with our palliative patients around goals of care, where are they in their decision-making, where are they in their disease process.

And then we work very closely with our OnePoint pharmacy. They do provide pharmacy services for our hospice patients. We've seen a lot of efficiency and enhanced customer service and working with OnePoint. It's really been a differentiator for us.

And then from a home health perspective, Elizabeth shared a lot about our home health. They have some of the highest quality in the industry. And again, we're really focused on getting patients upstream. So not only from our home health but other home health in the country, right? They have patients on service that need advanced care. And it's really using the data that Elizabe talked about SHP data to really identify triggers for these patients and ensure that they're receiving that care at the most appropriate time.

And then our home-based primary care services which Jon talked about our partners. I'll just give you an example about the type of scale that hospice has opportunity and working with them. And Ohio market last year, our [ board ] partners actually made 400 hospice referrals. So just a tremendous opportunity there.

And then from a focus on quality and operational excellence you've heard a lot about today, but that's rally what we lead as organization, ensuring that we're delivering a highest quality of care.

I'm pleased to say that over 2/3 of our hospice branches are 4 stars or greater. That's like a hotel, right? Many of you choose a hotel based on 5 star rating. CMS actually gives an opportunity to rank our hospices based on quality on a star rating scale. So the consumer actually chooses a hospice based on overall quality.

So many consumers in the AI world, they will use AI technology to choose their hospice. They choose us because we have the highest quality in the industry. So as far as an average daily census standpoint, as you can see by this slide, we've continued to move up and ending Q4 at 6,925. That's how many patients we have on service daily. I'm pleased to report that we're over 7,000 in our core business as of today. So great opportunity.

As far as our market growth trends this hospice sector in the health care world is a fast growing one. As you can tell, $31 billion and growing 4.6% annually. So the reason because -- the reason for that is 65 and older demographic is projected to nearly double. So 10,000 people a day turn 65. That's outpacing births in the U.S. So it's really a fantastic time to be in hospice. And routine care is actually over 90% of that revenue generated in the hospice industry.

And 98% of the entities have an annual revenue of greater than $50 million. So again, our margins are really solid as well in the industry. This is just a great opportunity to outline our scale and our reach. So again, we're coast-to-coast as far as a hospice and palliative care division, so a great opportunity.

As far as why BrightSpring? Why are we different than other organizations and how are we well positioned in the U.S.? A lot of the sector in the hospice is either a stand-alone hospice with no continuum of care or they're small operators.

Given the fact that we are a large organization, we really can provide economies of scale in working with our own pharmacy to also ensuring that we're putting best practices in place across the country. This differentiates us from other organizations.

From a referral competition standpoint, we get to lead out there with quality. So I lead the sales force. Everything that we do in the communities that we serve starts and ends with quality. In a narrow network, which is what most organizations are moving to, they want the highest and best quality at the lowest cost. And fortunately for BrightSpring that makes us an obvious choice.

And then from a workforce shortage standpoint, that's something that the industry is certainly facing. And without [ SN ], without caregivers [ DNAs ], we can not continue to grow our business. And so at BrightSpring, we are really focused on workforce shortages. We're very competitive in terms of wages and benefits. But we're investing in our workforce in terms of skill sets.

We're also -- we just finished our legacy awards which Jon presented a couple of weeks ago, really recognizing top talent within the organization. All of those are the reasons why people continue to choose BrightSpring. Jon mentioned people really linning up to work with us. it really is our culture that drives the difference there.

And then from an operational and administrative complexity, we have some of the best operators like Elizabeth in the country, really leading efficiencies. We are data-driven, so we have proprietary data that we utilize to enhance our overall offering and certainly drive quality results.

As far as our hospice differentiators, we could really break that down into three categories. So strategic positioning, expanded palliative care model and then health equity strategy. So we've talked a lot about the strategic positioning. We're best-in-class from a quality perspective. In addition to that, we offer the lowest cost care out there. So we're an obvious choice for payers, ACOs and value-based care.

And then expanded palliative care reach. We already talked about the conversion of our palliative care patients at 80%, ensuring that we're delivering the right care at the right time. This is an obvious opportunity for us to really expand our platform to help more people who have advanced illness and are suffering from pain and symptom management.

And then as far as integrated care model we talked a lot about that today, health equity is strategy we have at our hospice because 50% of people that are in need of hospice care get it today. That means we're focused on taking share from our competitors, number one. And number two, we're focused on the 50% of the population that don't get the hospice care that they need.

So many times that because of health equity, challenges whether it be cultural, whether it be socioeconomic. So we've developed a proprietary strategy internally to really focus on that population and bringing education to the communities that we serve.

And then just to talk about our performing metrics to brag a little because this is really a fantastic slide, as far as -- we provide more visits than the national average by 30%. This is a really impressive number. Average discharge length of stay, again, we're focused on patients upstream. And so 99 days is over 3.5 months of care, right? So that's been a focus for us.

We've been able to improve our margin year-over-year by 140 basis points, also another impressive statistic in the hospice division. And this is one I'm incredibly proud of. We're bringing access to care to 22,808 patients. That's 19% year-over-year growth. We're slated again this year for double-digit growth in the hospice division.

So -- and we've been able to do that for improvement in our referral conversion rate. So trending last year at 74.2%. We were able to improve that to 78.6% really through education and training of our clinical teams.

And then from a hospice building through clinical quality, I want to walk you through clinical quality because it truly is our #1 differentiator, as I've talked about.

So the HVLDL is our hospice visits last days of life. This is a measurement that CMS has put out to measure our impact on patient care. And so we're at 76.1% versus the national average of 48.3%. That is very impressive. And then 98% of BrightSpring hospices actually exceed the national average. That's almost 100% of our locations.

And then the CAHPS survey, this is something from a consumer standpoint. We talk a lot about consumerism because people have a choice there. So the CAHPS survey actually goes out to patients, and it's their way to really evaluate how we did with their loved one. It goes out to patients that discharge their families, and they basically grade us on the overall care that we provided. Also pleased to say 87% versus the 81% national average, so outpacing our competition.

And then from a continued improvement in our hospice care index, another CMS measurement, we're at 9.4 average scores versus 8.8 nationally. All these reasons set us apart as an obvious choice in the hospice industry.

And then skilled nursing visits. We talked a lot about our workforce. It is imperative for us to have a strong workforce and strong retention so we can continue to build on our skilled nursing visits. We're currently at 8.1 versus the national average of 7.8. So some really nice stat.

And overall, this is just a review of our star ratings. Over 74% of our hospice agencies have a 4-star or better. That's almost unheard of, right? And we really focus on timely help, enhanced communication back to our patients and families and then certainly help around pain and symptoms.

And then we do this through really a culture of eligibility, really teaching and training our teams on what eligibility looks like, specialized care that is patient-centered. And then certainly, we have a protocol.

And then from a growth lever standpoint, we want to expand our reach and patient impact. That's our whole goal. And so we really do that through four strategies: organic growth strategy, de novo and CON strategy, integrated market and strategic focus on growth.

So just to talk a little bit about organic growth, we are focused organically and going deeper, as I mentioned, in the markets that we're already in, taking market share, we want to drive to be 1, 2 or 3 in terms of overall market share in every market that we're in. As far as defined dementia strategy, dementia is one of the fastest-growing disease processes in the country. We have clinical pathways that we're focused on around dementia and cardiac.

And then expanding our liaisons. We use claims data today, we use proprietary data to basically ensure that we're in the right areas to drive access to care. And then last but certainly not least, ensuring that we are expanding our high targeted referral sources.

And from a de novo and CON strategy, I just wanted to talk about de novos as an opportunity. So we were able to launch 5 de novos slated for this year. So really excited about what that brings to the bottom line from an EBITDA perspective as well.

And then as far as the CON strategy, again, applying in 5 locations throughout 4 states this year and certificate of need. And we've talked a lot about the integrated market strategy, I think a key differentiator for us and then certainly a growth area. We've defined core KPIs across the continuum of care. We've actually selected multiple integrated markets to pilot. And so we'll be going deeper in each one of our integrated markets this year.

And then from a strategic focus on growth, which we talked a lot about ACOs and value-based care. They truly are narrowing the network, they are wanting to work with 1, 2 or 3 companies. They are not wanting to work with 7 companies out there any longer. So we're positioning ourselves for top choice for accountable peer organizations and value-based entities. We signed multiple preferred partners of agreement with ACOs this years as well as going deeper with payers on unique opportunities.

And then just in summary, this really sums it up. Coast-to-coast services, integrated care mode and then certainly our quality and operational excellence make us an obvious choice. And we want to continue to grow in this segment.

So thank you so much for your time today, and we'll certainly be around later for questions. Thank you.

Thanks, Rhonda. Terrific, terrific hospice business that's been built up over time, and thanks for all the strategic direction in that business today.

Well, Kim More, Kim and I go back about probably 12 years. Kim was probably our top operator at rehab care back in the day, which was the biggest rehab company in the United States by sites of service and skilled nursing facilities and ALF. So Kim has done a wonderful job with our very highly clinical neuro rehab business. And now as we look to extend that into the senior space as well. So take it away, Kim, thank you.

Thank you, Jon. So nice to have you all here with us. As Jon shared, my name is Kim More. I'm the Senior Vice President, leading the Rehab division at BrightSpring. And I've had the honor of being part of this organization for the past 8 years now, and I look forward today to sharing the integrated care platform that we've built and that we continue to scale across rehab and personal care services. So let's dive in.

All right. Every year in the U.S., millions of people survive brain injuries, they survive strokes and neurological trauma. But the challenge isn't just survival. It's in the recovery that follows. Our highly trained and skilled clinicians are dedicated to this recovery, focusing on restoring critical functional abilities, including communication skills, basic physical independence, activities of daily living, mobility, cognitive skills recovery, executive functioning and emotional regulation.

Rehab's continuum of services span post-acute transitional centers of excellence, home and community programs, day neuro and outpatient clinics and now Rehab in Motion senior living outpatient, which is embedded directly within the assisted and independent living communities.

Beyond neuro rehab, we also provide complementary services that leverage that same clinical infrastructure and care coordination capabilities, including pediatric ABA, which is applied behavior analysis therapy for children with autism spectrum disorder. In 2026, the prevalence of autism today is 1 in 31 children.

We also provide state-contracted foster care support programs focused on providing a safe home for children in need counseling and wraparound services, supporting stability, life skills development with the ultimate goal of family reunification and sometimes adoption. Again, another statistic to show you this as a chronic demand is 250,000 children enter the foster care market in the U.S. each year.

That -- the thread that really ties all of this together is that coordinated multidisciplinary approach that is designed to help people recover function, to regain their independence and reengage in their communities while delivering the care in the lower-cost settings with the best-in-class outcomes.

Now next, to fully appreciate the opportunity that we have in rehabilitation. It's important to understand the structural problem that we have -- that we are solving today in the U.S.

The U.S. health care system was designed to treat episodes of care, a surgery, an acute illness, a hospital stay. Traditional rehab models assume a linear recovery, fixed lengths of stay and volume-driven reimbursement, but neurological recovery does not follow that pattern.

Recovery from a brain injury is what we call nonlinear. Patients often progress, they plateau and they improve again during that critical window of neuroplasticity. Patients with complex neurologic diagnosis are frequently underserved in home health and skilled nursing facilities because they were not designed for their needs. The results, as you've heard hospice speak and home health as well, is fragmented care, inconsistent outcomes, unnecessary hospitalizations and higher system-wide cost.

BrightSpring's rehab model, on the other hand, was purpose-built for that nonlinear recovery. Our model is designed to follow patients across that full continuum. Upon discharge from the acute care setting, our patients may transfer to our post-acute transitional living centers to our home and community services and through our day neuro and outpatient therapy services.

And what truly separates and differentiates us is our clinical specialization and longitudinal engagement. Our teams deliver neuro specialized therapy, cognitive rehab, behavioral integration and community reintegration, including return to driving. We have a specialized return to driving program, return to school, return to work and meaningful life recreational activities.

This level of care requires specialized neuro clinicians, highly coordinated multidisciplinary teams and regular engagements where the patients actually live. It also requires sustained investment in quality, in compliance, in clinical infrastructure and IT advanced solutions that you heard Charlie and Viji mention earlier.

Each year, approximately 1 in 60 Americans sustains a traumatic brain injury. Over a lifetime, 1 in 4 U.S. adults will experience at least 1 TBI. 1 in 4, that's incredible.

Traumatic and acquired brain injuries affect individuals through pediatric through geriatric populations. Examples include for our youth population during sports injuries and trauma, for our working adults from motor vehicle accidents, workplace accidents, falls, assault, violence and extreme recreational sports. And then for our seniors, most often from falls.

The U.S. neuro market alone is estimated at $6 billion, growing at around 7% annually. Payers and referral sources increasingly want scaled providers that can deliver predictable cost, standardized protocols, seamless care transitions and consistent outcomes across markets that creates that clear advantage for national platforms like we have at BrightSpring.

All right. Next, I'd like to introduce our most exciting growth platform this year, Rehab in Motion, which is our Medicare Part B therapy model that is embedded directly within the assisted and independent living communities.

This program serves our seniors where they live with dedicated on-site multidisciplinary team delivering physical, occupational and speech therapy. The focus of our Vitality program is on reducing frailty, preventing falls, improving their mobility and maintaining independence while also reducing that important hospitalization risk.

A key differentiator is our proactive fall recovery training. We teach residents how to safely recover after a fall, building confidence and reducing fear through our trauma-informed care model.

Rehab and Motion is highly integrated with our home health partners, primary care, pharmacy and care coordination services, creating that true continuum of care within our senior living environments. Today, we operate in 20 communities across multiple states, with expansion underway through de novo growth through our partnerships and through targeted acquisitions.

As many of you already see and see and experience in our health care environment in the U.S., it has completely and fundamentally shifted. And that shift has created opportunity for us at BrightSpring. Aging in place is no longer optional. Acute care capacity constraints and cost pressures are pushing us to provide that care in lower-cost settings. And at the same time, value-based models are increasingly focused on functional outcomes, fewer hospitalizations and predictable cost.

BrightSpring combines that national scale, integrated care delivery and deep clinical expertise to deliver rehab services across home and community, senior living environments and align precisely with where the system is going today and into the future. Most providers have pieces to that solution. BrightSpring operates the platform today.

So let's next spend a moment on our geographic footprint and the structural advantages of our rehab model. One of the unique strengths of our platform is that it is not dependent on a fixed base of real estate. We deliver care directly in the home and community. Our model is inherently capital-light and flexible, allowing us to scale efficiently as the demand grows.

Another important advantage is our ability to enter new markets quickly. Since our model is built around clinical teams rather than brick-and-mortar, infrastructure expansion can happen much faster than in traditional rehabilitation settings.

Brain injury and complex neuro referrals frequently cross state lines, and many of our referral partners operate on a national basis as well. Our national clinical infrastructure allows us to combine that local care delivery with enterprise-level support, quality oversight and operational discipline.

So we -- when we talk about growth, we pursue it through three primary strategies. First, again, de novo expansion. We enter approximately 8 new markets each year focused on proven geographies and referral relationships; second, payer contracting, diversifying payer mix, strengthening reimbursement with our government and commercial and workers' compensation contracts; and third, through disciplined strategic M&A, enhancing geographic density, scale efficiencies and value-based alignment. Together, these levers support sustained capital-efficient growth.

Now our clinical outcomes, we are also proud, and I've heard my peers as well speak to this, but this is absolutely the foundation of our rehab program. Our programs deliver measurable results, including an MPAI score of 9 compared to a national average of 5. This reflects a robust clinically meaningful improvement for our brain injury patients. More than 50% of our patients achieve 8 or more hours of independence in the home environment, which is a critical milestone in brain injury recovery.

Customer satisfaction also remains exceptionally strong. In the fourth quarter results, we had 100% in our outpatient and 98% in our home and community services. These outcomes reflect the expertise again of our clinicians, our focus on quality and compliance and the effectiveness of our integrated care market.

So when we step back, the opportunity should be really clear. Brain injuries and neurological conditions are cumulative, they are chronic and they are increasingly prevalent as the population ages. Facility-based episode-driven care models were not built to accommodate this reality.

BrightSpring's rehab platform meets patients where life actually happens, delivering that specialized care in post-acute settings designed to keep people out of the hospital and support long-term recovery. That's the model that we have built, that we are expanding and we are proud to offer at BrightSpring and why rehabilitation will remain a meaningful driver of growth of impact and value creation.

All right. Next, I'm going to shift on to our personal services platform. Recovery, here's a key point. Recovery doesn't end when therapy ends. That's where personal care becomes such an important part of BrightSpring's continuum of care. It allows us to extend that support beyond the clinical treatment and into daily living, helping individuals maintain independence, avoid unnecessary institutional care and continue living in the environment they prefer most their home.

From a health care perspective, this work is also extremely valuable because it helps to lay the need for that higher-cost institutional care such as skilled nursing facilities.

Today, our personal care platform operates over 21 states, serving more than 16,000 individuals through over 160 locations nationwide. Supporting that care delivery is a workforce of more than 12,000 employees, including 10,000 caregivers working directly with families in their homes. In total, our teams deliver 13 million hours of care annually. This geographic footprint allows us to combine that scale with local opportunity expertise, which is critical in the service model that depends on those strong community relationships.

Today, the business generates approximately $402 million in annual revenue, serving more than 16,000 individuals across the markets. When you take a step back and you look though at that broader landscape, the U.S. personal care market alone is estimated at roughly $80 billion and continuing to grow.

The underlying drivers of the growth are super clear. First, demographics. Nearly 90% of adults over the age of 65 say they want to remain in their homes as they age, and personal care services makes that possible.

Second, economics. Home-based care is significantly more cost-effective than institutional alternatives, which makes it increasingly attractive solution for our payers and for our government programs. And third, our ability to expand through multiple channels, including VA programs, commercial payers, private pay services and strategic de novo expansion.

Importantly, this business also creates natural synergies with other BrightSpring services, including our rehab services, home health, hospice and pharmacy, allowing us to support individuals across the full continuum of care.

Quality and compliance are also foundational to how we operate this business. Across personal care operations, our overall quality score currently stands at 87%, representing a 2.7% improvement since 2023.

The scores reflect rigorous oversight of regulatory requirements, including supervision, care planning, documentation of service delivery, emergency preparedness and infection control protocols. Our client record compliance score is 92%, demonstrating that strong adherence to state-specific regulatory documentation standards.

And ultimately, our focus is simple here, delivering high-quality evidence-based services that align with what patients and families value most, independence, safety and dignity at home. What makes this platform particularly compelling is how all of these services work together across BrightSpring.

Rehabilitation restores function. Personal care helps individuals maintain that independence over time. Together, they allow us to serve patients across a much longer period of their care journey while strengthening those referral relationships, improving those outcomes and expanding market opportunity.

Thank you for your time today and your partnership and the belief in the opportunity ahead.

Thanks, Kim. I was wondering if you were going to try to read that huge quote.

I know. No, definitely not.

Do you guys want to come up here for a little Q&A?

Yes.

Hopefully, you guys are getting a sense of the broad-based quality of a lot of these businesses and the broad-based growth in the organization. So really some terrific provider service lines here that we're fortunate to have in the organization.

Any questions on the provider side? Joanna?

Larry Solow, CJS. First question, just from a high level, it seems like acquisition opportunities is more on this side of the business. So as you look out 5, 10 years, where do you see geographically? Do you see yourself expanding a lot, especially on the home health side, where you're only in the Southeast?

And then as part of that, do you look for -- most of your properties are obviously very high provider scores, high-quality service. When you look for acquisitions, are you -- will you only look for that? Or will you also look for somewhat distressed assets where maybe service levels aren't as good, but it gives you an opportunity to expand geographically and also improve those service scores and financials?

Yes. Thanks, Larry. Maybe I'll start and you guys can add any thoughts.

But clearly, I think we will continue to try to expand geographically in each one of our hospice, rehab and home health businesses. Our focus in home health will largely be integration over the next year of those acquired assets. I think after that, we will continue to look at certain target markets.

Hospice, we are very open to the right partnerships there. Hospice, like infusion, has seen extremely elevated multiples in those industries. Most of those businesses in both of those markets can trade at 15x or more. So we've been very patient there with more of an organic focus. And wherever we've done a rehab tuck-in, it's worked out extremely well.

So -- but I would say across the company, it's really balanced from a pharmacy and provider perspective, Chris was going to talk about this in corp dev a little bit later. But our focus on M&A will remain balanced across pharmacy and provider.

So hospice rehab, home health here, but then also infusion and some very hopefully low multiple tuck-ins on the home and community pharmacy side. That's been our history. It's worked for us. It gives us a lot of optionality. We get a lot of selection preference by being able to look across those service lines. And I think that you'll see that posture continue into the future.

On home health and hospice, there's probably ultimately 35 states in each that I can see us participating in, and we're roughly a little over 20 sort of around in each today. So whether that's de novos or CONs organically or whether some tuck-ins, that's where we'd like to build to ultimately.

Any other thoughts from an acquisition standpoint?

I would just say we meet with business development on a regular basis and are looking at M&A opportunities. So we have a team that is focused on a core strategy and making sure that these deals meet that strategy.

I would just say the last piece there, too, is, and it's -- these are just things that are meaningful every day for us that we see, there's a lot of operators in this incredibly fragmented set of markets that are looking for a long-term home. And we are regularly approached from owners about "I see BrightSpring, I see what you guys are doing, public company public stock. I would love for that to be long term home for my people."

A lot of the sellers that you come across, the good ones, really care bout what happens in their organizations, their people. Like they don't want to see their company dismantled. But change is inevitable. and so if there's going to be change, hopefully that change is focused on best practices within a company with a great culture.

So we routinely, and that's one of our drivers of M&A that we'll talk about, see proprietary access to situations. I can think of three right now that are going on, smaller deals, where the owner has literally said, we want to go with you, no offense, versus private equity or versus some other massive company. We win those like 80% of the time on preference. And so we look forward to being that long-term home within these ever-evolving industries.

Joanna?

So Rhonda, a question for you on hospice because that business in the provider segment has been growing very nicely and I guess, prior to this recent acquisition, was the largest piece of that segment. But I want to ask you about reimbursement because that piece of that business, I guess, is driving some of the multiples, as Jon talked about. So a question here or two part actually.

The reimbursement is stable there, right? But there's been more focus on fraud and abuse in certain markets specifically, but also at the federal level, more audits and things like that. So do you expect this to kind of put some pressure on reimbursement? Is there any indication that there could be some changes to reimbursement in hospice?

And the second piece on the Medicare Advantage [ carbon ], right? So CMS kind of gave up on this idea, but do you guys expect this to eventually become reality where you have to actually contract with Medicare Advantage payers in hospice?

A great question. So I would just say, to address your first question around fraud and abuse, I think it's very well known that California and Texas are looked as states that there has been a lot of fraud and abuse going on. Here at BrightSpring, we have a very detailed compliance process. We also work with an amazing accreditation organization actually, too. We work [indiscernible] hospice site as well as [ HDHC ].

So I feel like that really prepares us as an organization. We are doing the right thing. So I am not as concerned at BrightSpring. But from an industry standpoint, I do think that will continue to be a focus, but -- I actually sit on the Board of [indiscernible]. So this is something we look at on an ongoing basis. But I do feel like we're very well positioned as an organization there.

Second piece of your question around -- refresh my memory, I am so sorry, Medicare Advantage. I do believe that at some point, Medicare Advantage will become a reality. Right now, over 90% of the care that we provide is to fee-for-service Medicare patients. However, we have had carve-in examples, they did not -- they were not highly successful in the past.

But M&A does seem to be still very focused on this as an opportunity. We meet with payers all the time, and they're very quick to ask us many questions about the business. So I do think it is in our future. And we continue to prepare ourselves for that with some unique value-based agreements with payers today.

Hospice has such a strong value proposition from a quality and a cost reduction standpoint. So Rhonda is right, those pilots or demos did not go well. So I don't think there's anything going on, and Daryn can speak to this in the GR section in this world of significance today. So not on a lot of people's radar screens.

I would just say back on the fraud point, we have actually over 900 third-party accreditations in our company across all of our service lines. I mean almost 1,000 different accreditations from third-party accrediting bodies, which are very difficult to get. They come in and audit you very deeply. And you only get that gold star, if you meet all their criteria. So we focus on that extensively.

I would say we absolutely support the administration and what they would be doing around anything in this area, of course. I don't know the percentages. I would venture to guess that 99% plus of the providers out there in these industries are very well intentioned, dedicated, committed clinicians and individuals. And if there's fraud in any industry whatsoever, we should attack that and root that out.

Hopefully, we can continue to collaborate with the government in this area to make sure that the right targeted solutions are implemented in the future. You would never want to throw the baby out with the bathwater as there are -- the vast, vast, vast preponderance of providers are very compliant. So we would look forward to dialoguing with the administration as they continue to try to go after any individuals who might be abusing the system.

Jon, I just wanted to the comments on MA carbon. There's nothing imminent on the horizon there. Certainly, industry has been very vocal about that, but we'll watch it closely. And if it is inevitable, we'll certainly be ready for it. And then from a rate perspective on the hospice side, it's been very incredibly consistent because the statutory structures of those rates force it to be incredibly consistent. So yes, we feel very good about where that sits.

Thanks, Daryn.

Question for Elizabeth. So when we think about these Amedisys or former UnitedHealth assets that you've taken on from a previous coverage of that company, these are, from our understanding, that you've picked up some of the best assets within that portfolio. So as we think about areas for potential improvement, whether that's margins, clinical outcomes, where do you see that?

And then I guess the second part of my question is, what are you seeing in terms of the competitive environment as United is seemingly like losing focus on home health and then Elara Care just went to DaVita, so that they're probably going to take on some of that capacity in-house? So just curious what you're seeing on that front.

Yes. I see significant opportunity in the home health space. Like you said, I have had a long history at Amedisys and definitely knew how that company operated. And they are strong branches. They have a metrics-driven mindset, a culture-driven mindset. And I have been out visiting those branches. They're excited to be here.

And I think because of the acquisition that was taking place and they had kind of been on hold for a little while and now we are there with specific growth action plans, the teams are excited to grow. So I definitely think we have opportunity with this acquisition.

Same for LHC. LHC has -- we competed with them over and over who's going to knock each other off the top spot for quality. Great quality mindset. And we brought that team here right after the acquisition and really had introduced and welcomed them to our company, showed them what our culture was. And all we hear they're excited to be here and ready to grow. So we think there's definitely upside.

The margin we acquired was a little bit lower than our margin. And so over time, we would expect that to even out. So I think that's an opportunity. And then also from a growth perspective, it can be challenging when people are in a situation where there's a pending acquisition for a year or 2. And so we're excited, as Elizabeth has said, to really drive a patient reach and growth focus in that business.

I think as you look at the bigger industry, Brian, I think what I said before is I just think we have a real opportunity there with some of the biggest independents having been acquired over the years. Enhabit has now been taken private. That was a little bit of a challenging situation with Encompass over the years. And so we see a really attractive runway.

As I think I mentioned before, there's probably only 2 companies who've been around for 40 or 50 years in the hospice space where that's out of reach. But other than that, we absolutely want to be known not only as the biggest, but the best operator in home health and hospice and rehab in the industry. And I think we have every opportunity to do that, and we are well on the way down that path.

But I think those dynamics in the market have probably created more opportunities. And we've been trying to work with MA and payer partners over the past year or 2 to partner with them just around outcomes and what is a fair rate, given better outcomes. And we've had some success there, and we would look forward to continue to do that.

I remember several years ago, one of the CEOs of one of the biggest payers in the United States said that we've looked at everything over the years. And it is our opinion that home health impacts outcomes in a positive way more than anything else. And so we just want to continue to try to scale that business.

When there's something like 40% of the people today written for home health who do not get it, which we just cringe when we hear that. So hopefully, you'll get rate stability. I think CMS showed some real understanding in the final rule back at the end of last year. And we're optimistic that the support will be there, given the outcomes, and we want to continue to scale in that market.

A.J.?

A.J. Rice from UBS. You commented on personal care services and what the market growth was. I wonder on home health and hospice, I may have missed it, but I didn't see where you said we think the market is growing this. We think we can pick up through geographic expansion or through de novos additional growth. Do you have any way to size the metrics on growth around hospice and home health?

And then I might pivot over and ask about the primary care initiative. Is that MDs? Is that nurse practitioners? Are they your employees? Are you contracting with people? How are you structuring? What you're doing there?

From a market standpoint, we see home health and hospice is about 5% to 7% market growth. Obviously, you get some of the demographics at play there. Hospice also, I think there's still only about 50% of the individuals eligible for hospice actually receive it. So there is -- on top of the underlying population demographics growth, if more people start utilizing hospice as they should, that's what makes hospice a little bit of a higher growth rate than home health.

We want to grow in that industry double digit. So our internal goals every year are going to be around 12% to 15%. And so obviously, we have to be taking share, and we want to do that through our volume, continuing to enter new markets and invest in sales.

On primary care, about 80% of those clinicians are NPs. The there is not an unlimited supply of PCPs and doctors who want to be making house calls versus perform neurosurgery. And so you have to augment that with very skilled NPs, who can very capably be the primary care provider.

And for nurse practitioners, they love it. The pay is very good, and you are your own clinician, you're the doctor. And that's empowering. And we see that NPs are very excited to have their own panel of patients in these various buildings and across homes.

So we've been investing a lot in those individuals with training and making sure they feel appropriately compensated. It's a great job. I go to that assisted living facility today and spend all day there treating their patients. I go home at 5:00. We've got centralized on call. It's a great job where they can make an incredible impact.

And they're your employees?

Absolutely. All [ FTEs ] . Across our whole company, we're FTEs [ 10 99 ].

Yes, Raj Kumar from Stephens. Maybe just kind of focusing on home health and the preferred provider arrangements, maybe what's kind of driven initial success there? What's kind of the ongoing conversations around payers in terms of what they're looking for? Is it just capacity, higher acuity focus? And then maybe any specific targets as we go through the year? And maybe just any color on the economics of those arrangements relative to fee-for-service?

Elizabeth, you'll probably keep the economics out of it.

Okay. Yes. So we have had a lot of focus on that, but quality drives everything. That's what they're looking for and reduced hospitalizations, keeping those patients out of the hospitals. That's where payers really have an advantage.

So we're getting phone calls now wanting to partner with us in post-acute networks. And managed care organizations wanting to create some really, I guess, value-based care arrangements. And so -- but I'm going to stick with quality. Quality is what makes that phone ring for people to want to partner with us.

Yes. It's -- look, they have access to all the data. And across all their members, across all home health providers, what we hear is we do better, so we want to do more with you, right? And look, there are some payers out there in the past more so, but still even today that don't -- aren't willing to pay a breakeven rate, which is ridiculous when this service is so incredibly valuable for their members.

That has really improved over the years. You've seen a supply-demand imbalance in favor of the providers. And what we've seen in the last 3 years is progress with rates. But where we like to have preferred partnerships, send us more of your patients, and we will try to prioritize them, there has to be a fair reimbursement rate for that. And in these arrangements, we've generally moved in that direction to a level where we're willing to engage.

Yes. Jared Haase from William Blair. I guess maybe just a couple of quick ones on the primary care business. So I'm curious, from a go-to-market perspective, are you primarily leaning into the existing relationships that you have on the pharmacy side in the home and community space with SNFs and assisted living facilities?

And I guess, as we think about your growth initiatives on pharmacy, are you sort of leaning into almost a joint go-to-marketing where it's, "Hey, we can manage both pharmacy and medical for this particular community"?

And then I guess the third point around this, just if you are thinking about this as sort of a joint go-to-market, how penetrated is the primary care business relative to your existing book on home [ pharmacy ] side?

Yes. Where we are today, it's going to lean more towards your second comment, which is as we move forward, we see a lot more opportunity to work together in these buildings and in these communities as one organization, cross-selling, as you will, but really presenting yourself as one organization.

I would say, historically, we certainly have examples of where we are in settings and locations because of a handoff, warm handoff referral from pharmacy or even home health already being in the building. That's not the majority of how we've entered into our home-based primary care buildings today.

I think as we go forward, to use just a generalization, 50-50. That -- just like all of our businesses, that primary care team will be responsible for their own growth because you can't, in our view, be solely dependent on another service line and relationship for your growth. You have to own your own growth as well.

But the other 50%, we should be growing through relationships and partnerships that we have in these buildings in pharmacy, in home health and rehab and hospice, and that is a much bigger opportunity.

So to your third point, I think we're 5% down the road on that. That strategic growth area, including this cross-sell integrated care. We're hesitant to talk about it too much and distract from core growth, but that really could be a very large opportunity for the company over the next 5 to 10 years, but -- and it makes all the sense in the world, obviously.

Well, thank you, guys, for your attention. As we've gone through our provider business here for the last 1.5 hours or so, I think we're going to take a break for lunch. It's about 12:10. We'd like to be back by 12:30, 12:35, 12:30. So if we could shoot for about 20 minutes, that would be terrific. And then we'll touch on government relations, M&A, finance with Jen, and we'll wrap up by 2:00. So thank you.

[Break]

Welcome back, and you guys are doing a great job of adhering to the time schedule. So thank you. But welcome back. I really do hope this is being an informative and enjoyable day for you guys here in Louisville, where our headquarter is. So thank you again for joining us. I wanted to also say they're not even in the room really, but Natalie and Lisa and Lee and a whole lot of people who helped put this event on today. I really wanted to thank them for everything they did. Really last, these little bats here at Louisville Sluggers. So sometimes when we close an acquisition, Louisville is home to Louisville Slugger. We'll do baseball bats as kind of the deal toy.

So in my office, you would see like 15, like really cool bats, different colors every time with the name of the deal on it. So you're not probably able to travel or you don't want to travel with a full-size bat. So we just got you some little ones. It just says BrightSpring Investor Day. These are safe to stick in your bag. They won't stop you. So if you want to grab one, there's a basket of them below the stairs before you leave. And with that, we will wrap up the day over the next hour and 20 minutes, get you out of here on time. Daryn is going to talk about government relations efforts, and then Chris Consalus will be here in corp dev and then Jen on some of the numbers. So Daryn, take it away.

Thank you, Jon. Good afternoon. The political guy loves the podium and loves the pop and circumstance of the podium, feel like I got to get my hand gestures in. And I did want to take a moment to announce my candidacy for Governor in Kentucky today, but just can't help that political side of me. It is an absolute honor to lead our government relations function here at BrightSpring Health Services. I've been in the leadership role for a decade, essentially as soon as Jon had come on with us. And I just really -- I've been asked to kind of get straight to our issues pretty quickly today.

But I did want to say a couple of things upfront that are just really words that are -- if you have any takeaways from what I say because I know you all have a lot of familiarity with the issues I'm going to talk about. Two words are outcomes and visibility. Outcomes. So proud to hear all of our operators today and when Jon and Jen do their earnings calls, investor meetings, the outcomes that we drive as a company are just incredibly impactful on our efficacy as advocates. It is just a really great thing, and it's also incredibly important to just our credibility as advocates as well. So we use all the numbers you're hearing about for our specific divisions all the time. And this is a super, super important thing, super, super important for the company as well.

And then on visibility, I'd like to speak about that in 2 ways. One is visibility within my team and the visibility for the company and relationships for what we do, visibility on issues and visibility that's changing as we continue to grow as a company, a lot of regulators and lawmakers are coming to us proactively through preexisting relationships, through knowledge of the company opposed to us going to them and introducing ourselves who the company is, what we do. And so that's just a great piece of our growth. Here on this opening slide, I would just note that we have a very experienced, very consultant-heavy team on the GR team. That's very purposeful. We're heavy with consultants, so we can be flexible. If we need new issue experts, if we need to move resources in a different state where we're not that strong and might need a lobbyist, we can do that very, very quickly.

And on the resource side, one of the great things about partnering with Jon over the last decade is he's never said no to me on anything government relations related and have asked for additional resource. I'd say no to him sometimes, but he never says no to me for just kind of [indiscernible] approach and just spend that we have availed to us. We just are always well heeled for what we need to do and to do it effectively. And our focus is really -- we're in education and [indiscernible] function. We're out there talking about all those great outcomes that I mentioned before. And really everything from rate, workforce issues, structures of our programs. We're just using all the facts and everything we have to educate and drive good outcomes for our programs.

So with that, I'm not going to talk to you -- you all know the environment is difficult. The stuff on the other side about just team approach. I'll skip that in the -- but as it relates to just the environment, it is a complicated environment. As we look at the federal agenda for the balance of the year, there are not many legislative vehicles left that we'll be able to move our items in. The upside of that is there's not many legislative vehicles left to move things that we're not excited about.

So we'll be working really, really hard for what is most likely trying to get 2 or 3 bills into a year-end package in D.C. We fully expect the Trump administration to continue to be very aggressive with their executive orders and rule-making, and we continue to have just good visibility on all of that. And I would say everything we worked on in 2025, the first year of the Trump administration, there were some things that required heavy lifts. Those heavy lifts afforded us good access to leaders in the Trump administration. So we know who they are, they know who we are. And as we go into '26 and beyond, those relationships will be there.

So jumping into just the key issues of the day for us. I'm going to hit on 7 different issues. Left side of this slide, references stuff that happened in '25. The other side is what we're going to be focused on in '26. I'm going to co-mingle the 2 issue by issue. First is the Inflation Reduction Act. We're going into -- the first 10 drugs going live on January 1, we did work very hard on parallel tracks with CMS and the Hill, introduced legislation in both the House and Senate, excellent momentum for our House legislation. But the other side of the track was working in the White House and CMS.

And we did have great success there with 2 different memos that went out to Part B plans and payers specific to our long-term care pharmacies that had the most impact from IRA. Those directives to say to be fair with pharmacies on IRA were very effective in mitigating the ultimate impacts. And as we move into '26 with IRA, our focus is going to be very much on taking it another step further. We think there's more that CMS will do as they see the impacts that are happening in the field, particularly with some of the smaller pharmacies in the space. And we'll be moving to continue to gain cosponsors for our House and Senate bills and hopes that we're well positioned to pass at year-end if we need it, absent additional CMS action.

Drug pricing, whether it's most favored nations, tariffs, implementation of the IRA, certainly 1 million things out in the ether last year. Our singular focus and all those things was to make sure, one, are there impacts? And two, is anybody thinking about the impacts on pharmacies. And I think we did that very effectively in 2025. And I know early off in '26, we're doing that effective again and will continue to be our focus on all things drug pricing this year. Next, PBM reform.

We were very, very excited to finally see PBM reform pass the federal level earlier this year. It took a very, very long time and our specialty pharmacy association was particularly effective with our partners and their efforts to make sure that our most important element that was passed in their contract changes that finally give CMS some teeth in working with pharmacies and PBMs on contracting disputes. So over the next 2 years, CMS will be working to establish reasonable and relevant contracting terms. And then CMS will have some -- once that goes live in 2028, CMS is going to have the authorities to implement some civil penalties when those aren't followed.

On the home infusion side, and just going into this year with PBM reform, certainly, our focus is going to be working with CMS to make sure our voice is heard and the right things are implemented in that process. On the home infusion side, going back to the Cures Act of 2016, there has been a real deficiency in the fee-for-service payments and infusion. We've got legislation focused on Part B that had a hearing a few weeks ago. It has a great group of cosponsors, and we are very optimistic that this is a year that we get that fixed after many years of lawsuits and legislation and otherwise.

This year, our folks get it. It's a no-brainer, needs to get done, very optimistic that will get done. Home health rate, you've heard about that already from Jon today. We never celebrate a cut, but to go from where the administration started in the proposed rule, to an 80% mitigation in the final rule, we felt exceptional about as an industry and felt very optimistic about the stuff that's in the -- that was in the final rule going into rule-making for calendar year '26 or '27. And so we're excited about that and meeting with CMS, working the hill and just really pleased that we have good strong champions and really expect to be fortunate to have more predictability and stability in that rate going forward.

Medicaid, people have asked a lot about just kind of what does the One Big Beautiful Bill Act mean to states. In 2025, we were net positive on the Medicaid side. We have just an incredible historic run of being net positive on the rate side in Medicaid. We certainly expect that to be the same in '26. We're hearing a lot of conversation at the state level about the One Big Beautiful Act. We're talking to them a lot about it. And post the behavioral transaction, obviously, our Medicaid footprint will be smaller, but we will not be any less visible in states on that. And the one thing that there were many positives in the One Big beautiful Bill Act, including positives in Medicaid.

And what they did in Medicaid is they just really signaled to states and the legislation that the populations that we serve, the must-serve populations in Medicaid must be protected as states implement elements of that bill. And we've seen that so far, and we expect to have a solid net positive rate in Medicaid this year. And last, my team supports all things in growth, certainly, the transaction -- home health transaction closed last year, working in partnership with Chris and his team on the behavioral transaction getting closed, tuck-ins, CONs, anything organic. We're constantly in communication, providing intel, opening doors as needed and just have a really great partnership with both operations and the M&A team on that front.

And Jon, that's it for me, and I'll be up a little bit later for the Q&A. Thank you.

I think as Daryn said, one of the things that we take very seriously is just given our scale and our scope and given our quality, we are routinely asked by individuals, offices on the hill and at CMS and HHS for our views on things, just given what we're out there seeing every day in our relevance. And so we're always honored and glad to be a part of conversations as they're occurring to be able to provide our input and try to always be making decisions that make the most sense at large for society.

So with that, Jen and Chris are going to join. And Jen, I think we're starting with you. And then we'll get into corp dev and then you'll go again. So everybody knows Jen Phipps. She's our Chief Financial Officer, what has it been? Over a year? I think over a year. Yes, you're over a year. And -- but Jen has been here for almost my entire time, almost a decade in a lot of different positions in the company, including Chief Accounting Officer before being the CFO. So Jen has just done an incredible job in this seat over the last year, but she had already been doing a ton in this capacity for years and years before that.

Chris and I had worked together at Kindred. Chris has been here probably 7 or 8 years as well. Chris was one of the corp dev leaders at Kindred. He's our corporate development leader here, SVP at the company and a critical role as we have obviously done a lot of M&A. A ton of it's been small, accretive tuck-in, but have even more opportunities going forward. So Chris, I appreciate you walking us through that as well. So go ahead, Jen.

Thanks, Jon. So as Jon mentioned earlier today, we are just very proud of what we've done from a leverage and our balance sheet position with the company. Post IPO, we were at about 4.5x levered. And at the end of 12/31/2025, we were at 2.99x. When you pro forma the balance sheet for the Community Living transaction, which we expect to close by the end of the quarter, we would be at 2.6x. Before any uses of capital, we expect to be under 2x for 2026. So if you just think about the EBITDA growth and the cash flow generation that we would have.

We continue to increase our EBITDA conversion to cash, and we've done that each of the last several years. We expect to be at greater than 60% conversion to operating cash flow in the coming years. Our CapEx requirements, as a reminder, are very light. And so we are typically well under 1% of revenue from a CapEx standpoint. Ultimately, that position has allowed us to make significant investments in technologies and systems, de novos, automation equipment in our pharmacies and has allowed us to obviously still generate really positive free cash flow.

Our balance sheet and free cash flow generation, our leverage position provides us with what we expect to be significant, and we'll talk a little bit more about it later, flexibility to fund additional deals through M&A. So I'm going to turn it over to Chris to spend a little more time talking about our M&A capabilities and our focus for '26 and beyond.

Thanks, Jen. Thanks, everyone, for joining us today. One slide here to go through and then my part will be done. I know a lot of this has already been discussed during today. So hopefully, I won't be too repetitive, I did want to drive a few things home. Since the beginning of 2018, when I arrived here at BrightSpring to partner with Jon and Jen and the rest of the team, we've completed approximately 79 acquisitions. 76 of those 79 are in a better place from an EBITDA perspective than when we acquired, looking through the last 12 months ended January 26. Over that time, our approximate multiple we paid on a TTM versus pro forma basis now is approximately 50% decline, which we're very, very proud of as an organization, the M&A team, everybody involved.

Obviously, we would love it to be 79 out of 79, but 76 out of 79 has been a pretty good record. Average -- the median purchase price is approximately $5 million, lots of tuck-in M&A. We have done some bigger deals throughout the years. I think there's probably 5 or 6 that we've done north of $100 million. If you adjusted that for the average, the average price is probably closer to 20 than the 5, but median being what we look at, the deals range anywhere from $300,000 of spend that we've done to almost $0.75 billion. So we really run a full gamut there of acquisitions.

When we start thinking about like why are we successful, there's a variety of factors. Mainly, it's largely the teamwork here and the buy-in from the collective organization, whether it's the executive committee, whether it's corp dev, whether it's our operations leaders, there's people that really have an M&A growth-focused mindset where we're able to go and find proactive deals or get involved with various bankers and brokers in terms of sell-side processes that are out there. That's probably square one of how we've been able to do so many accretive acquisitions over the years.

The other, probably #2 on my list is disciplined investing. We're not just out there buying EBITDA. We're making sure it makes sense, and we're getting sign-off from not just Jon and Jen and Chris and the rest of my team over there between Doug, Nick and Thomas. We're getting sign off from the operations team. We're getting sign off from the person in charge of payroll and HR. I mean, it really takes a village to do an M&A deal here. And we have between the 10 to 20 people you've talked to today, there's another 50 behind the scenes that are helping make all these acquisitions work.

So it's really an incredible team effort to get to that point. I know it's come up a couple of times today, but we also have been successful in some deals in the past using more variable structures in terms of how we would finance or buy a business, whether that's offering equity, seller notes, a portion upfront. We did an acquisition in Q4 of '24 down in Florida in the hospice space, where we got very creative in terms of the capital that we're willing to put together for a nonprofit system because of how their foundation worked. It was incredibly attractive to them, and they got a sizable chunk of BrightSpring stock, and that's worked out very well for them and it was obviously a great transaction that we did.

I would be remiss without mentioning our integration management office. So they're kind of the quarterbacks behind everything once we get to a signed letter of intent to closing a deal and then integrating the transaction, running the show. We meet weekly with them, with our 40 or so functional leaders and make sure that everything that we're doing is being done the right way and any issues that come up are being addressed in the correct fashion. And then last but not least, we obviously leverage our economies of scale. When we started doing this back in 2018, we were largely a Medicaid company that now has one of the largest home health and hospice businesses in the country.

And as we've added those assets, each individual acquisition thereafter has gotten a lot easier to integrate and source. Generally, when we're looking at transactions, we're looking to do 10 to 15 deals a year. You can do the math. It's about 10 per year that we've averaged. Ideally, with where we are now, the team that we have, the investment that BrightSpring has made in corporate development, we would love to be at 15 transactions a year. We think we have the team to get that done. Another thing that's come up, we're very balanced between pharmacy and provider. Historically, you're going to be looking at, depending on the year, somewhere 60-40 split between transactions allocated to provider versus our pharmacy business.

It's one of the unique positioning factors for us as a company to be able to do transaction in both spaces, which also leads us to the sheer number of acquisitions we've been able to be closing over the last few years, largely focusing on everything that we're investing in today, whether it's the provider side or the pharmacy side, home health, hospice, hospice pharmacy, rehab, home infusion, tuck-in, lower multiple transactions in the LTC space in the IDD, ALF and SNF space as well. And then also looking at select opportunities. We've done a couple of these acquisitions over the last 12 months in both the technology and home-based primary care space.

Lastly, and I know Jen's mentioned this, and it's been mentioned throughout the day, but one of the other things that makes my job a lot easier than it otherwise could be is just the general performance of the company and our capital structure, IPO deleveraging, the sheer amount of operating cash flow we threw off last year helps us fund deals. It's a lot easier than having to go out and finance every transaction if we were in private equity. And then also generally just the low CapEx.

I know Jon mentioned our time together at Kindred, that was a much more heavier facility-based CapEx industry. We don't have that here, 1% of revenue, very low, allows us to generate more free cash flow and be successful. So thinking about the past, the future, I think we're set up very, very well to take what we've done and grow on that in the next couple of years. And I know we'll get into that a little bit more in terms of the capital that we have to deploy, but I appreciate everyone for listening to my tech talk.

Thanks, Chris. Well, you can go sit down and bring it back up for questions. Perfect. So we're going to go ahead and just go through some of the financials. And I'll move through some of these slides a little bit quickly because you know most of our historical numbers. So just as a reminder, we have a really strong track record of historical growth in revenue and EBITDA. If you look at our revenue CAGR from 2022 to 2025, that is really a 26.6% compounded annual growth rate, and it's over 18% on adjusted EBITDA. That has largely been organic over this time period, although it did have some M&A in there. Pharmacy's adjusted EBITDA CAGR was about 17% and providers is about 15%. So really good, strong balanced growth across both of our segments, as we've mentioned in many cases.

Our total company CAGR being larger than that has been because we've been able to leverage our scale and really get an opportunity to drive down our corporate costs as a percentage of our total enterprise. We've done all of that. We've talked a lot about this in calls and other Q&A that we've done historically. But we've got a chance to really make investments. And that is something that we continue to do every single year. We've talked about a lot of the IT investments, the people investments. You've heard a lot about new members of teams that exist today that didn't exist sometimes earlier in this time period. We are very focused on making sure we're balancing our growth for today with long-term growth as well.

So we've been able to continue to do that and still achieve these numbers. In 2025, we saw margin expansion, in '22, '23, '24, you did see some compression of margin as our Specialty Pharmacy business was growing at an outsized pace to the rest of our -- rest of the growth and [indiscernible] our businesses. And with that growth, obviously, we talked about from a mix standpoint, there was a compression in margin. We expect the continuation of margin expansion. You saw that in our guide which we'll talk about in a minute for 2026, and we expect that to continue to grow as the underlying factors in all of our businesses, we expect margin expansion in those businesses.

Just a few stats to note about our revenue and EBITDA growth. Jon mentioned a couple earlier today, but for the Russell 3000 companies greater than $5 billion of revenue, we were second in 3-year revenue growth. So if you were to compare our growth, obviously, to the 3000, we were second. For public companies over $10 billion in revenue that were profitable, we're in the top 6% in 3-year EBITDA growth. So really strong performance across various different companies and different industries. We're really proud of the work that the teams have done. I'm not going to spend time on the KPI slide, you have all this information we wanted to provide it to you against just for ease of reference, but ultimately we continue to grow volume above market, we're focused on that in each of our different service lines, and we're focused on doing that underpinned by our high-quality services.

So maybe I'll just move on to the next. So on February 27, we initiated our 2026 guidance. This guidance, just as a reminder, excludes the Community Living business, and it excludes any acquisitions that have not yet closed. Revenue is expected in the range of $14.45 billion to $15.0 billion, including Pharmacy Solutions revenue of $12.6 billion to $13.1 billion and provider services revenue of $1.85 billion to $1.9 billion, reflecting growth of 11.9% to 16.2% over full year 2025. Total adjusted EBITDA is expected in the range of $760 million to $790 million for full year '26, which reflects a 23.1% to 27.9% growth over full year 2025.

This guidance does include $30 million expected contribution from the Amedisys and LHC branches as we had mentioned in our call. So maybe on to the slide that most people probably care about. So as mentioned, we have a historical track record of 18% CAGR over the last several years. So we talked about from '22, but you could actually do it from 2018. You could do it from 2020. It's a very similar number. That does include M&A. We have seen acceleration of that growth in the last 3 years, which you can see reflected from '23 to 2025. Just another stat, if helpful for public companies in health care, over $5 billion, we rank fourth in 3-year EBITDA growth.

As we've had the opportunity to discuss in each of the business units, the underlying drivers of the growth that we have seen remains intact and underpins our view of '26 through 2028. Today, we are hoping to provide a framework for growth over the next 3 years. As we look forward, we have provided, as we just talked about, a guidance range of 23% to 28% EBITDA growth for 2026. And as we look beyond 2026, off of the high point for '26, we see the opportunity for 15% to 20% organic CAGR from the end of '26 to 2028. That represents, as Jon mentioned earlier, a 70% to 85% growth from 2025. Please note, the spots on the graph are not actually intended to depict actual point estimates, but rather a framework for the CAGR and the visualization there. So I had been informed that people might use protractors to like measure.

So that is just representative of what -- not necessarily intended to depict a point estimate. This does not include -- to be clear, this is organic and does not include additional growth from capital deployment. So as we discussed earlier, Chris talked a little bit about it as well, we have a really strong cash flow generation and balance sheet position. And as we think about the opportunities to deploy capital, we really think of this as at least $2 billion worth of additional incremental capital availability through 2028 to provide opportunities for growth in M&A. And so while again, we're not putting that -- that's not a guidance number, but that's just really as we're thinking about the deals, we are going to get the opportunity to be very strategic about the acquisitions that we do. Our balance sheet position gives us a place of power as we think about the deals that we think are very important and can provide value to BrightSpring.

So with that, I will turn it over to Jon to wrap it up, and then ultimately, we'll move into Q&A.

Thanks, Jen. And so what I had alluded to earlier, as you look at Jen's numbers that she just went through, I had alluded to point-to-point aggregate growth numbers that we believe are achievable as you go from the end of '25 to the end of '28, that 3-year period. And so at the 15% scenario for '27, '28, that CAGR at the low end of the base rate, that produced about a 70% 3-year aggregate total growth. And at the 20% end of that range for '27 and '28 CAGRs from the end of '25, that produces about 80% total growth over the 3-year period. So hopefully, that's helpful.

On M&A, that's about half of the [indiscernible] on the M&A on the wall over there in terms of our team. And we've got about 8 people or so on that M&A team today. So it is a really highly capable group of M&A professionals that we've invested in and have at the company. And I think one of the things we really try to do well is to really spread that M&A around in terms of the type of deals we're doing to create as much value as we can and to balance things out in terms of certain deals that look like this for size and multiple and then other deals that look like this. And things have really balanced out in a very healthy way over the last 7 or 8 years. I get fairly involved in those deals. And so maybe it's like 7.25 FTEs we have on the team.

But I think with, as Chris said, the ability to find proprietary deal flow, being a preferred next destination partner home for the sellers has worked in our advantage. And I think as we go forward, having capital available in the form of public stock is only something that's been helpful for us, too. So Jen mentioned $2 billion of capital available for M&A, that would even be without using stock. That number is probably in the [ 2% to 3% ] range, while still staying within the 2x -- 2 to 3x leverage range of theoretical capital deployment potential that we see to the end of 2028. That by no means indicates that we would go do that amount of M&A.

But as you just run the very simple math on our base case, that is what the math produces in terms of that several billion dollars or plus of capital availability outside of stock currency. So as we get into the last slide here in Q&A, I did just want to reiterate some of these historical numbers one more time. Jen just touched on them. But you're sitting in the room of a company that has had 7-, 5- and 3-year revenue CAGRs of 22%, 25% and 27%. Adjusted EBITDA CAGRs over 7, 5 and 3 years of 18%, 18% and 19%. And if you look at that 3-year CAGR actually move forward a year, including '26, so '24, '25 and 2026, that 3-year EBITDA CAGR, if we hit our guidance this year, would go up to 26%.

Again, as you look at all of the Russell 3000 over $5 billion, that revenue CAGR over the last 3 years puts us second to Eli Lilly. As you look at all of the Russell 3000 for companies over $10 billion within health care, we are again second to Lilly. From an EBITDA perspective, for all public companies in health care over $5 billion of revenue, we're fourth in EBITDA CAGR. And for all public companies in health care above $10 billion, we're second in 3-year EBITDA growth again to Lilly.

So really just want to thank the team at this organization for what they've been able to do over the better part of a decade now, driving these results. So hopefully, this has all been constructive, a good use of time today. We've obviously focused on some of the bigger themes as we encapsulate the organization, again, large growing markets that still clearly have unmet needs. Within those markets, we're providing high ROI services to very complex populations who benefit greatly from those services. Everything is based on our outcomes and our capabilities, which has been driving market share gains on top of the healthy growth rates in those markets.

We believe that our scaled platform, our one company platform has many advantages and has been one of the reasons why we've been successful. From a financial perspective, we've been proud of what we've been able to achieve in our growth profile, particularly comparatively. And hopefully, we continue to build on a very experienced and proven leadership team in the space. What you've seen here today is just incredibly tip of the iceberg. We're going through bonus time in our company. In every year, we literally go through every single person's name in the bonus file, bonus-eligible employees, and make a final determination on their outcome for the year as we do with the annual equity grant file.

In the bonus file, there's some 1,800 people that we literally go through every single name every year, making sure that bonus makes sense. And the last couple of years have obviously been -- that's been a fun exercise. The question has been how can we do more for our best people. But when you go through that exercise, it is incredibly humbling to just see the amount of people in the list of names that we have in this organization that are just stars. So just even in the last 6 months, I can think of 20 people that we hired that would be worthy to be up here today speaking in front of you guys. And so we will just continue to add to that depth in the organization, and we are investing as much as we can this year to try to continue to position the company as best we can in the future.

So I'll wrap it up. I just -- I am going to read sort of that prior slide that from this morning. If I was talking to my neighbor or one of our equity analysts, friends and colleagues or somebody at KKR or one of you as an investor or any employee, this is just in layman's terms, how I would describe our company, and this is on Slide 18 or something like that. So why BrightSpring is different? BrightSpring focuses on home and community services to a large and growing population of complex patients with services that all improve outcomes and reduce cost and thus create great value. That's everything we do in each business. We prioritize attractive markets.

We leverage scale and create efficiencies in meaningful ways and drive our best practices through each of these home and community pharmacy and provider businesses, delivering to them the resources they need to succeed and grow. We execute at a high level on acquisitions and our scale, leverage ratio and cash flow position allows us to further capitalize on accretive and geographically expanding M&A. We still have many additional integrated care opportunities across the complementary service lines to drive more coordinated care and patient volume and impact. And we have a large opportunity to leverage our care management capabilities and further develop our ACO scale and payer partnerships to grow in value-based care payment models.

Moreover, we have related attractive service lines doing well and gaining share in growing high-need markets. And these service lines all do better and are better together within the BrightSpring platform. We're on the right side of health care trends and needs with a unique enterprise and set of assets from which to deliver solutions to all industry stakeholders. That's what this company is all about every day.

So with that, thank you, guys, for your time. Make sure to pick up your bat if you want on the way out, and we are available for Q&A. Jen, I wasn't going to forget Q&A. We've got a healthy amount of time here, about a half hour for Q&A if we happen to use it all.

Jon and Jen, thank you for hosting us today, really valuable use of time. Maybe, Jon, as I think about just the runway for growth, when you lay out these things, large growing market, high ROI, we think about generics, LDDs, the demographic trends. I mean I appreciate you've given us through '28, but is it right to think that these trends should continue past '28?

I guess I would answer that in 2 ways. Number one, and chime in wherever you guys see fit, really, really hard [indiscernible] things, I think, in business and in life beyond a couple of years. And we see it today, obviously, business and trends and disruption has never moved more quickly. So hard for us to think much beyond the several year time frame. I would say second, and maybe this is going to be a 3-part answer, we don't see anything necessarily other than the law of large numbers in math that would impact our growth in the future. And we will continue to lean into that as much as we can.

I would say the third point would be we are very passionate here about continuing to leverage what we think is a unique and differentiated platform to continue to drive that growth. There will obviously be twists and turns in our markets this year and over the coming years. But I think with our complementary diversification, I think with our scale, and I think with the operational quality and growth themes and priorities that we have in the organization, I think there's a resiliency there that is better positioned probably than anybody else in health services to continue to work through any changes as constructively as we can. But I would say we've never been more excited about the company. And I think I said that last year, and I think I said that the year before, but it's really true.

Jon, I would just add from a public policy perspective, our diversification has really proven to be a high value for us. If we've got one division that's had a challenge that we're working through, we've got others that are flourishing with opportunity, and we expect that to stay the same. A.J.?

Just a follow-up. I think since the IPO, the company has generally talked about 10% to 15% tuck-in deal -- 10 to 15 tuck-in deals a year, about $100 million of acquisition spend. With the capital that you have available now, do you see yourself leaning into maybe picking that up a little bit? I know also on secondaries, you've now started to buy, when some of the distributions have happened in stock. What's your thoughts about that going forward?

Yes. On the latter, I mean, I think we take secondaries as they come. Clearly, as we look out into the future on the last 2 secondaries, we were eager to acquire that stock back at those prices and think that will -- that's very value accretive. So we'll take those case by case. I think our base case would remain the same is that we would lean into those. From an M&A perspective, our pipeline has never been stronger. And we just always have to be and try to be as judicious as we can around prices and valuation. There's quite a few of our businesses that have been seeing 15, 20x plus EBITDA multiples in the M&A world.

And some of our businesses are in very highly valued markets. So I would say that's something that we're very careful about. But we will continue the steady stream, almost to use a cliche, sort of the string of pearls approach to M&A, where we continue to do really good deals, probably more modestly sized or smaller size and just stack and stack and stack those on top of each other. And that really adds up. That is our base case. But the fact is that today, our balance sheet is in a different position, and we think a very good position as well as our cash flow generation capability.

And I think we would be -- I think we would assume that the aggregate EBITDA acquired, particularly, I would say, as we get into 2027 would pick up. We are not under LOI right now on any significant deal. We need to see the Community Living deal, in fact, close, and we needed to get through the home health asset acquisition. And then we would reevaluate from there based on what is at hand. But I think as we look into the later part of '26, and I think, in particular, as we get into '27 and '28, I would be probably a little bit surprised if that activity doesn't pick up.

When we look at -- and maybe this is for Jen, too. So but when we look at that 15% to 20% consolidated or enterprise-level EBITDA growth, I guess, I don't think you're giving explicit components of that. I guess, to what extent -- how should we think about the trajectory in terms of any sort of change in the trajectory that we should anticipate across the 2 different key segments in terms of pharmacy versus provider? Or should it just be more of a continuation of the same on that front? Or any nuances to think about as we think about particularly like '27 and '28? And then from there, you're adding, I guess, 2 to 3 percentage points potentially from M&A, I guess, is kind of how it pans out. You mentioned the 60-40 split. Is that a little bit more weighted than historical on pharmacy? Should we read in between the lines there on the potential around pharmacy deals, I guess, going forward?

Yes. Going in reverse order again. So 2% to 3%, that's your number. We'll see what happens on M&A, but I think we're in a really good position from a balance sheet perspective, I think with a very unique ability to execute against successful M&A, and we're optimistic about that. I think we'll continue to be opportunistic in terms of where the deals are. Barring larger chunkier deals, 50-50 is a good assumption for how the provider and pharmacy deals would shake out. If we happen to do 1 or 2 more chunky deals, that would skew things based on whatever industry that was in. On growth as we go forward, I mean, we expect a lot of consistency there for sure.

But if I -- if we had to probably note a little bit of a change, just given some of the growth on the pharmacy side of our business, maybe does that moderate a little bit. We're very optimistic, though, about infusion and home and community pharmacy stepping up their growth rates. And we're optimistic about provider in terms of relative growth contribution in the company continuing to be more of that. So there could be a little bit of a tilting more towards the provider business and within pharmacy infusion in home and community, really just as a function of, hopefully, a lot of focus and execution in those businesses and those businesses doing well versus anything else pulling back. But we continue to see what we've seen historically. Our view is that we should expect to see and are attempting to drive a lot of consistent broad-based growth throughout the organization that we have historically.

I would just add 2 things. The first is that really what we were trying to do in the '27, '28 is to provide a framework and not specifically any guidance related to our expectations. The second thing that I would say is that we would expect to continue to leverage all of our infrastructure that we have from a corporate standpoint as well as we grow, which will be beneficial from a growth rate perspective.

Can I ask a question to a government guy, please? So on -- for home health reimbursement, the proposal was minus, I think, 6%. It came in at minus 1%. I think that they were considering what they call like a clawback to implement in '26, which did not happen. Is that risk now past us so that will not happen ever? Or what are your thoughts there? I thought there was a certain time...

Yes, there's a time period where it had to be revenue neutral, and we're getting at the end of that. And really, what they signaled, which is we use the word signal very carefully, is just potentially no more permanent cuts going forward and just temporary cuts. So we would expect to see something in end of June, early July with a proposed rule that has maybe a little element of a temporary cut in it. And then you always have the dance between the proposed rule, the final rule, and that's where the market basket stuff with your inflationary considerations come in, and we're very optimistic that we'll end up somewhere net positive at year-end.

And then going forward, there is an industry -- because we had a good reception from the Trump administration this last year, we're really having some deep conversations about what the most appropriate ask is. Now -- and I'm not going to get into what some of those are, but it's pretty exciting to be asking for something that's really positive instead of just playing pure defense.

So you would expect an increase, a modest increase with minimal risk of...

We're optimistic about where things sit before a proposed rule. And like every year, we could see a proposed rule that we're not really excited about. We see a final rule that feels pretty good.

Okay. And then just with IRA and drug pricing, Jen, maybe this is more for you. Do you collect rebates? And is that part of your negotiation process, your sort of standard negotiation process with manufacturers? Are rebate discussions part of that?

We have very little rebate exposure or benefit in our company.

Okay. And just one more quick one. What kind of margin lift can we expect to see for generics? Just any color around that when it goes from brand to generic?

Yes, we would not be addressing that. But generics are ultimately positive for everybody in the -- positive for payers and positive for everyone in the generic environment.

And when a drug goes generic, there's just the manufacturing side with the participating manufacturers on a drug goes from one to many, many, many. And so even though that there is a dramatic price decline in a drug when it goes generic, which is helpful for the system, you see the cost side improve as well because of the change in the manufacturing landscape.

Jen, you've talked on the call last time right there, the IRA headwind that you're facing, you talked about $15 million of mitigation in terms of working with PBMs for improving sort of the dispensing fees. Daryn, I think on your slide, you're talking about '26 focus areas, engaging with CMS for these kind of rules and implementation and also seeking additional protections related to IRA. What is the necessary component to then further kind of mitigate some of these headwinds because of the changes? Is that rule-making from CMS? Or is that the direction that they've given to PBMs and you just have to negotiate with PBMs?

So maybe before I turn it over to Daryn, I just want to clarify, $15 million is our expected net exposure post mitigation. I just want to clarify that.

So yes, going forward, CMS has signaled very clearly to us, and that's not even a signal, it's direct to our base. So I'm just using the careful cautious words here today. But they fully appreciate that particularly our long-term care pharmacies had a very niche impact with IRA, given how they're paid, reliance on brand drugs, all of that. So we have full expectation that CMS is going to listen as we're a couple of months into this. There will be good data after the first quarter from industry to take the CMS and talk about what the realities on the ground have been. And we expect a positive response from them if additional mitigation is needed. And we do have just -- we built exceptional bench of champions on the hill that are supportive of us that will communicate both to push legislation forward if we need it and just related to CMS that we need additional help if we need it.

Great. And just to follow up maybe on Erin's question. Maybe if we think about pharmacy, could you sort of maybe rank order the components of growth, maybe which ones have more contributed to growth in the coming year or the next couple of years. And so if we think about LDDs, generics, prioritization of infusion, home and community, like if you were to rank orders, which are the bigger contributors? Could you do that?

Yes. I think we'll have to see to a certain extent around the edges in each one of the businesses. But I think we're -- I think we like our position when we look at each one of those pharmacy businesses as being in a solid growth position as we look to the future. We think that's a good place to be. We have a lot of aggressive initiatives going on right now in infusion and home community pharmacy. So we have to see how those play out over the next couple of years. And there is the potential for those businesses to really step forward from a comparative growth perspective internally. I think as any specialty pharmacy business continues to scale, that degree of growth from a percentage perspective just becomes more difficult.

But we like being in a position where we are pushing businesses as much as we can for growth leadership in the company. I would just say, again, sort of related to the IRA question or policy, in pharmacy, we absolutely believe that scale and efficiency and quality wins the day. And that is what we are pursuing as much as we can in each one of those businesses. And then we'll see what happens in the external landscape. I think everybody views pharmacy as the white knight in the value chain, providing a lot of value to everybody, interacting with the patients every day, driving generic utilization, driving patient services. So we get a lot of support out there, rightfully so, as Daryn said. But regardless of what happens, we think that very differentiated scale, quality and efficiency is the name of the game. And so that's where all our efforts are -- remain focused on.

So a question, Jen, I want to follow up on your comment about the margin growth that you expect the margins to continue to expand. And in the past, I want to say you talk about your kind of long-term target of 6% EBITDA margin. So the question is, is it still on the table? And how are you going to get there? And sort of kind of walk us through the thought process there in terms of margin expansion, what's driving that?

Yes. So 6% was what we had said really at the time of the IPO, and we really saw very significant growth in specialty. That obviously, we talked a little bit about in '24 and '25, what that did in terms of the margins. We have very focused -- we're focused on each business, expanding their margins based on -- and ultimately up to what we think is an appropriate margin for that business. And so we have action plans at each operational team that are focused on lean process improvements, leveraging the scale we have in each business, focusing on driving volume in the right areas. That is ultimately going to be official. And so I think we do believe that we have additional opportunities.

We've talked about home infusion, home and community pharmacy, home health as being areas that we definitely see opportunities for merchant expansion. And then as specialty is growing, and we definitely see opportunities for real scale as well in that business and leveraging the infrastructure. So I would say 6% is probably a little bit further off in terms of a margin, but just given the growth of specialty and where we're at today, but we definitely expect margin expansion as we noted in the guide as it is related to 2026, and we'll be working to achieve some incremental in '27 and beyond.

Just following up on Brian's question. Just as you look out long term, be it next 10 years, what would you rank as like the biggest risk in terms of continuing this growth, competitive, macro, regulatory? What do you think -- just from a high level, what could kind of interrupt this trend?

Yes. A little bit difficult to conjecture. But look, I think these markets are so large, so fragmented and provide such clear value, that gives us a lot of motivation to just keep our heads down and to try to just keep grinding away and provide as many of these services to the people that need it as we can in each and every one of our core businesses. So we see a decade-plus runway in doing that. You know it's health care, reimbursement, right? And so -- but there, again, I think if you look at the value of our services, if our services are not utilized as much as they could and should be, if you squeeze that balloon, the rest of that balloon is going to explode and costs are going to go way up. It's just math.

I mean the ROI for our service lines one by one by one is dramatic. And the answer is to provide more of these services and to keep funding them more. We put all of these 700 projects that drive efficiency across the company in the last x years. It all goes back into people. We've -- 5 years ago, nobody in home health, hospice or rehab had 401(k), right? Everybody is screaming about it. Now everybody has 401(k), right? That was not $1 million. That was very, very much more than that. But these are the things that we are making sure we fund internally to have the clinicians to be able to deliver the services to grow. And so it makes all the sense in the world to fund individuals and to fund services that are delivering needed solutions at a high ROI in health care. So we have to continue to educate and advocate for all of those services.

And our view is that they should all be funded more because that's part of the solution in health care. But when you're, in concept, a price taker, you have to make sure that the external landscape is assane and logical as possible. At the same time, I think our scale, our quality, our efficiency, our growing automation and AI initiatives put us in a unique situation as we advocate and as we negotiate with payers around fair rates. And if there are disruptions, I think that creates opportunity as well. So our base case is a lot of continuity and a 10-plus year runway on just continuing to grow these services in these big core markets and advocating as much as we can to utilize these services even more given their value.

One little specific. On the -- I know '28 is not guidance, but in that number, that value-based piece, I assume it's still probably not significant? Or are you some kind of -- it will grow, but are you assuming actually a material driver from the next 3 years in that piece in the value-based?

We are not. That would potentially be upside depending on -- I think related to the framework, which is not guidance, we would have the same philosophy regarding how we set guidance, which is high confidence in our views based on what we see today.

Any more? Well, thank you for coming today, everybody. It has been -- do we have one? [indiscernible] under the water.

Can you talk a little more about the efficiencies opportunities like what you've done so far and where you see incremental opportunity in AI?

Yes. So we've got -- and we're making pretty careful buy versus build decisions because we don't want to sit on the sidelines for a year while we try to internally execute against some of these opportunities. So there's been numerous examples of where we've already deployed AI in our company working with an external vendor. A couple of those have been in home health, in particular, a few in Home & Community Pharmacy. "And it's not always AI, I mean, automation in and of itself is great." And there's automation that has less AI to do it with it, and then there's kind of classic AI automation.

But we are leaning in. We don't -- while we want to partner with great people out there, in 5 years, we don't want to be held hostage by 20 AI vendors, right? And so we're leaning into that. And we're making the necessary hires and resource investments to do that. I would say there's probably 7 or 8 key focus areas of initiatives going on right now in the company, spanning intake, rev cycle, clinical, patient care management, and the hiring and onboarding process, those are some of the central ones now. And we're making good progress. I think by the end of the year, most of those should be getting out to the other side of that work stream and going live.

So -- and then I would assume next year, we'll have 15 more. But we'll keep driving that as much as we can. We've been able to generate a good amount of savings here pretty much every year going back the last 5 years. And while obviously, that net somehow finds its way to profitability, but we are using that to make continued resource investments in our people and in our processes and in our technology. And I think that served us really well.

But we will keep the focus on operational best practice as much as we can. I mean there's a lot of us that really get a lot of satisfaction and enjoyment out of just how do we run the tightest ship possible operationally. I mentioned before, we aspire to be an HR academy company per se. I think we're pretty close to that even today, but there's even more things we're doing from a career management perspective internally and automating a lot of the HR process that I think gets us fully there. I think we feel the same way about IT and lean and process.

I remember going back to my first days in the company world after banking and private equity. And at Medtronic, not only were they very buttoned up around lean and Black Belt, you could be sent to companies that were known for this. They would train you, even other companies that were just known for their lean in their best practice operations. We want to be that company. right? And I think within health services, at least, we're way out in front. But as we talk internally and with Charlie and Viji every day, I don't know if it's realistic for us to be the most advanced technology company in the world, that's probably not possible, but I think it is possible within health care. And I think it is absolutely possible within health care services in the next 3 years. So that's where we're going to continue to push and try to be.

All right. Well, thank you guys for coming today. It's been really enjoyable for us to meet with you. I hope you had a nice quick trip, and it's been great seeing you, and I'm sure we'll be talking to all of you very soon. So hopefully, that was informative today. I did want to thank all of our employees out there across this organization. I mean there are tens of thousands of people taking care of your family members and people in our communities every single day in a very mission-driven way. And so this company does an incredible amount of good. And with that mission, we just tried to run the company in a good way as well. So I think we had well over hundreds of people viewing in on video today. And so we appreciate everybody's time. And hopefully, it was an afternoon well spent. Thank you.

Good day, and thank you for standing by. Welcome to the BrightSpring Health Services Inc. Fourth Quarter 2025 Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded.

I would now like to hand the conference over to your speaker today, David Deuchler, Investor Relations. Please go ahead, sir.

Good morning. Thank you for participating in today's conference call. My name is David Deuchler with Investor Relations for BrightSpring. I'm joined on today's call by Jon Rousseau, Chief Executive Officer; and Jen Phipps, Chief Financial Officer. Earlier today, BrightSpring released financial results for the quarter and full year ended December 31, 2025. A copy of the press release and presentation is available on the company's Investor Relations website.

Please note that today's discussion will include certain forward-looking statements that reflect our current assumptions and expectations, including those related to our future financial performance and industry market conditions. Such forward-looking statements are not a guarantee of future performance. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from our expectations.

We encourage you to review the information in today's press release and presentation as well as in our annual report and Form 10-K that we filed with the SEC, including the specific risk factors and uncertainties discussed in our Form 10-K. Such factors may be updated from time to time in our periodic filings with the SEC. And we do not undertake any duty to update any forward-looking statements except as required by law.

During the call, we will use non-GAAP financial measures when talking about the company's financial performance and financial condition. You can find additional information on these non-GAAP measures and reconciliations of our non-GAAP financial measures to their most directly comparable GAAP financial measures to the extent available without unreasonable effort in today's earnings press release and presentation, which again are available on the Investor Relations website.

This webcast is being recorded and will be available for replay on our Investor Relations website.

And with that, I'll turn the call over to Jon Rousseau, Chief Executive Officer.

Good morning, everyone, and thank you for joining BrightSprings Fourth Quarter and Full Year 2025 Earnings Call. I'd like to begin by expressing my and the company's appreciation to all of our BrightSpring teammates who work hard to deliver attentive and quality patient care and services to people and communities across the country. They drive the realization of our mission forward every day.

2025 was another productive and impactful year at BrightSpring in many ways. Overall, we saw continued success, delivering revenue and EBITDA growth while achieving many milestones, all underpinned by the delivery of high-quality and compassionate services and care to patients. In the beginning of 2025, we announced our plan to divest the Community Living business, which will streamline the company's operations and create more focus on core patient populations in prioritized markets.

Earlier this year, the Community Living divestiture transaction was approved by the FTC, and at this time, we expect the transaction to close at the end of the first quarter. The transaction is expected to result in net after-tax cash proceeds of approximately $715 million, which we intend to primarily utilize for debt paydown to further improve our leverage and further strengthen the balance sheet.

Additionally, the acquisition of Amedisys and LHC home health assets closed in the fourth quarter of 2025 in a two-part transaction on December 1 and December 31. BrightSpring acquired 107 branches at a purchase price of $239 million, which was fully funded from cash on hand. The assets generated full year pro forma revenue of $345 million in 2025, which includes the months throughout the year prior to the transaction close.

These assets are very complementary to our existing home health business from a geographic perspective while also being in the same markets as our hospice locations in many cases. And we are thrilled to have the Amedisys and LHC assets and colleagues integrated into BrightSpring as we are already taking steps to bring new and improved company capabilities to these acquired operations. This is another example of thoughtful, logical, strategic and accretive M&A that has defined our acquisition's history.

Home health, of course, has a tremendous value proposition given its impact on clinical outcomes and cost as it is shown to reduce ER visits and hospitalizations by 15% and 25%, respectively, and reduce mortality rates by 30% relatively. With an estimated 35% of patients referred to home health but who do not end up receiving the service, home health should continue to be an important solution in the future of health care.

Some other accomplishments of note in the Pharmacy and Provider business last year include: continued LDD wins, strength in quality metrics, technology and people investments that resulted in ongoing efficiency gains across the organization, de novo expansions and small tuck-in acquisitions.

BrightSpring's operational and financial performance exceeded the high end of our guidance range for the year, and we believe that the company's performance is a reflection of the value of our patient-centric, lower-cost, timely and proximal care, enabled by our people and culture who maintain an ongoing commitment to provide excellent and leading services.

Moreover, our goal is to continue to build out a unique and scaled Home & Community health care platform that demonstrates leading quality outcomes and operational best practices, a platform that is best positioned to be a critical partner and solution in U.S. health care.

Before discussing BrightSpring's fourth quarter and full year performance, I would like to remind you that the company's financial results and 2026 guidance pertain to continuing operations and do not include results from the Community Living business and the effects of any future closed acquisitions.

For the fourth quarter, BrightSpring's revenue grew approximately 29% and adjusted EBITDA grew approximately 41% versus last year's comparable quarter, resulting in full year 2025 total revenue and adjusted EBITDA that were above expectations. For the year, total company revenue was $12.9 billion, representing 28% year-over-year growth, which included Pharmacy Solutions revenue of $11.4 billion and Provider Services revenue of $1.5 billion, representing 31% and 11% year-over-year growth, respectively.

Full year 2025 adjusted EBITDA was $618 million, which grew 34% year-over-year. And adjusted EBITDA margin for the company was 4.8%, a 20 basis point increase versus 2024, primarily driven by cost efficiencies from procurement and operational initiatives, along with generic revenue mix shift pharmacy.

On cash flow, the company realized $490 million of cash flow from operations in 2025, and leverage was 2.99x as of December 31, 2025, which declined from 4.16x as of December 31, 2024. Overall, BrightSpring performed well in both the fourth quarter and full year 2025 across all business lines, and we are very pleased with the position of the balance sheet and expanded cash flow profile of the company this year.

Today, we are initiating total revenue and adjusted EBITDA guidance for 2026. We expect total revenue to grow approximately 14% year-over-year at the midpoint of the provided range and total adjusted EBITDA to grow approximately 25% year-over-year at the midpoint of the provided range. Included in total adjusted EBITDA guidance is an expected contribution of approximately $30 million from the Amedisys and LHC acquisitions. We are excited for the year ahead, and Jen will discuss our 2026 outlook in more detail shortly.

Before I discuss our business performance, I'd like to highlight BrightSpring's commitment to our employees and the communities, individuals, populations and therapeutic areas that we support, whether our people, seniors, youth or other specialty patient populations.

At the company, we continue to lean into helping individuals and organizations with access to resources and opportunities, for example, in supporting employees through difficult unforeseen circumstances through our share program, in college scholarships, in nursing school partnerships and in partnering with many, many organizations, such as the Special Olympics for one.

We currently operate a foundation through our hospice service line and we have now started an enterprise foundation that will more formally carry on all of our community and patient support activities. We are hopeful that this BrightSpring Health Foundation can positively impact lives for decades to come.

I'd also like to briefly highlight our strong patient satisfaction and high quality scores in the fourth quarter, which are driven by our delivery of attentive and skilled care to complex populations in a timely and relatively lower cost manner. In Home Health, we continue to see over 91% of our branches at 4 stars or greater with timely initiation of care at an industry-leading level of 99.4%. In hospice, our metrics remain well above the national average with a top 5% ranked hospice program in the U.S. and a CAHPS overall hospice rating of 87%.

In Rehab, our patient satisfaction scores remain very strong with 100% outpatient satisfaction and 98.4% home and community rehab satisfaction. In Personal Care, we have a client satisfaction score of 4.6 out of 5 compared to 4.5% in the third quarter along with strong internal client records and quality indicators audit scores. In Home & Community Pharmacy, dispensing accuracy was 99.99%, order completeness was 99% and on-time delivery was 96.8%.

In Infusion, our patient satisfaction score was 94%, and we were 1 of only 2 providers in the country to receive the ACHC IG distinction award based on our clinical and operational commitment to the IG patient population. Specialty Pharmacy demonstrated a consistently strong medication possession ratio of 92.4% in the quarter, along with time to first fill of 4.1 days, both much stronger than the national average.

In the second half of 2025, Onco360 ranked first and ranked second in the MMIT physician and office staff satisfaction survey. BrightSpring continues to demonstrate very strong service and quality metrics across all businesses.

Turning to BrightSpring's financial results by segment. Total Pharmacy Solutions revenue grew 32% in the fourth quarter, and adjusted EBITDA grew 44% versus the prior year. Total pharmacy script volume was 10.8 million in the quarter driven by total pharmacy census growth. Total pharmacy volumes declined 1% due to a slight decline in Home & Community Pharmacy volumes from the previously mentioned unwinding of a large customer going through bankruptcy and our decision to exit specific uneconomic customers.

Specialty and Infusion script growth was 30% year-over-year in Q4. In the Specialty and Infusion business, performance throughout the year exceeded expectations with fourth quarter revenue growth of 43% year-over-year driven by market adoption of existing LDDs, new LDD wins, fee-for-service growth and strong commercial execution in the field.

BrightSpring saw strength in the quarter from both brand LDDs and generic volumes, our total LDD portfolio now standing at 149 LDDs including 5 launches in the quarter and 24 total launches in 2025. Moving forward, we expect 16 to 20 plus limited distribution drug launches over the next 12 to 18 months. We believe that our growth will continue to be driven by new LDD launches, generic utilization, commercial execution with referral sources and expanding fee-for-service.

We are excited to have been chosen as the preferred specialty partner for additional new innovative therapies this quarter, which include infusible LDD therapies to treat a range of oncology, rare and complex diseases.

In Infusion, the business performed in line with expectations in the fourth quarter with solid script volume growth. Adjusted EBITDA in the quarter grew in double digits driven by the benefits of operational initiatives and process improvements. We expect to continue to see improved profitability in Infusion from our operational and growth initiatives moving forward.

In Home & Community Pharmacy, we are pleased with the progress throughout the year. We've executed consistently across several end markets, including in behavioral, assisted living, hospice and skilled nursing. As we've entered 2026, we continue to enhance our go-to-market strategy, invest in growth resources and look forward to driving expansion in each of our end markets while we execute against the 2026 set of process, technology and automation work to drive ongoing efficiency improvements.

Turning to Provider Services. We are very pleased with the overall performance in the quarter and the year. In the fourth quarter, segment revenue grew 13% year-over-year and segment adjusted EBITDA grew 16% year-over-year with an adjusted EBITDA margin of 16.4% in the fourth quarter, a 50 basis point expansion year-over-year, primarily driven by economies of scale and efficiency.

Home Health Care, which represents approximately 55% of revenue in the Provider segment, grew 19% year-over-year. Average daily census grew 15% to almost 35,000 in the quarter driven by strong quality metrics, de novos, execution on partnerships and preferred MA contracts and strategic tuck-in acquisitions in target markets. In home-based primary care, we are excited by the large opportunity that exists, especially with ACO payment strategies. We continue to invest in resources in this strategic area and we believe we can further expand our home-based primary care business to benefit payers and their members and better connect patients to other integrated services that they need.

In Rehab Care, which represented approximately 20% of Provider revenue in the fourth quarter, revenue growth was 8% year-over-year. We are pleased by strong person served growth of 13% and hours billed growth in the core neuro rehab services of 17%. Growth in the fourth quarter was driven by neuro rehab de novo additions and very high patient satisfaction scores, along with continued expansion of our rehab and motion program into ALF and home settings. We are excited by momentum in rehab Part B for seniors and look forward to driving additional de novo locations this year.

Turning to Personal Care, which represented approximately 25% of Provider revenue in the fourth quarter, revenue remained steady to up and grew 4% year-over-year. Personal Care person served grew 2% to 16,175 in the fourth quarter. In the quarter and throughout 2025, we saw steady operational performance as we continue to provide high-quality supportive care to seniors and assist with activities of daily living in the home.

Overall, I'm pleased with our operational execution throughout 2025, leading to excellent business performance across BrightSpring's Enterprise. We now have a 7-year CAGR of 22% on revenue and 18% on adjusted EBITDA. 2026 is off to a consistent and good start as we remain focused on leveraging our leading complementary and differentiated service capabilities and leveraging our scale, operational efficiencies and best practices to deliver high-quality coordinated care to complex patients.

We will be hosting an Investor Day on March 17 and look forward to discussing the BrightSpring platform and strategy that enables high-quality, lower cost, timely care delivery to an approximately 1.5 million senior and complex patient individuals every day. We'll provide information on the operations, end markets and growth drivers of each of our business units, and we'll discuss our long-term company vision and strategy and the reasons why we've never been more excited about Bright Spring's future.

With that, I'll turn the call over to Jen.

Thank you, Jon. Before I discuss our financial results for the fourth quarter and full year of 2025, I'd like to remind you that in the first quarter of 2025, we began to record the Community Living business in discontinued operations as indicated in the press release and 10-K to adhere to accounting standards required for annual reporting. As such, all BrightSpring's financial results and forecasts that I will discuss are related to continuing operations and exclude Community Living and any acquisitions that have not yet closed. Management believes the presentation of the non-GAAP financials for continuing operations is a useful reflection of our current business performance.

In the fourth quarter of 2025, total company revenue was $3.6 billion, representing 29% growth from the prior year period. Pharmacy Solutions segment revenue in the quarter was $3.2 billion, achieving 32% year-over-year growth. Within the Pharmacy segment, Infusion and Specialty revenue was $2.6 billion, representing growth of 43% from prior year, and Home & Community Pharmacy revenue was $593 million, representing a decline of 1% year-over-year.

Home & Community Pharmacy revenue declined year-over-year due to the divestitures associated with the customer that declared bankruptcy and our decisions to exit specific uneconomic customers. This particular customer's bankruptcy process is still ongoing and our forward year guidance contemplates a variety of scenarios. However, we do not anticipate any changes to the year under any scenario.

In the Provider Services segment, we reported revenue of $394 million in the fourth quarter, which represented 13% growth compared to the prior year. Within the Provider Services segment, Home Healthcare reported $217 million in revenue, growing 19% versus last year; Rehab revenue was $75 million, growing 8% versus last year; and Personal Care revenue was $102 million, representing growth of 4% year-over-year.

For the full year 2025, total company revenue was $12.9 billion, representing 28% growth from 2024. Pharmacy Solutions segment revenue was $11.4 billion, representing 31% growth from the prior year. And Provider Services segment revenue was $1.5 billion, representing 11% growth from the prior year.

Moving down the P&L. Fourth quarter company gross profit was $413 million, representing growth of 22% compared with the fourth quarter of last year. For full year 2025, company gross profit was $1.5 billion, representing growth of 20% compared to 2024.

Adjusted EBITDA for the total company was $184 million in the fourth quarter, an increase of 41% compared to the fourth quarter of 2024. For full year 2025, adjusted EBITDA for the company was $618 million, representing 34% growth compared to 2024. Adjusted EPS for the total company was $0.33 for the fourth quarter and $1 for the full year.

Throughout 2025, we continue to implement procurement initiatives and have invested in and deployed new technologies to enhance operational efficiencies across the company. This has contributed to ongoing people and growth investments as well as net profitability growth and margin results for the fourth quarter and full year of 2025. In 2026, we anticipate our procurement and operational programs to result in additional gains through cost efficiencies, best practices and streamlining across all business lines.

Turning back to segment performance. In the fourth quarter, Pharmacy Solutions gross profit was $255 million, growing 25% compared with the fourth quarter of last year. Adjusted EBITDA for Pharmacy Solutions was $162 million for the fourth quarter, an increase of 44% compared to last year, representing an adjusted EBITDA margin of 5.1%, which was up approximately 40 basis points versus last year.

Provider Services gross profit was $158 million, growing 17% versus the fourth quarter of last year. Adjusted EBITDA for Provider Services was $64 million for the fourth quarter, growing 16% versus last year, representing an adjusted EBITDA margin of 16.4%, up approximately 50 basis points versus last year.

Community Living continued to show strong operational and financial performance throughout the year, and we are pleased with the year-over-year revenue and EBITDA growth we achieved in this business in 2025.

On a total company basis, cash flow from operations was $232 million in the fourth quarter and $490 million for 2025, exceeding our annual run rate operating cash flow expectations for the year. Our adjusted EBITDA growth, combined with our cash flow generation during the quarter, has led to a leverage ratio of 2.99x at December 31, 2025, which we successfully decreased from 4.16x as of December 31, 2024.

At the time we provided our fourth quarter 2024 results in March of last year, our leverage ratio target was 3.0 to 3.5x pro forma for the Community Living transaction. And as of year-end, we have now reached a leverage ratio of just under 3x and below that expected range. Our review of year-end 2025 leverage pro forma for the Community Living transaction is 2.6x. We are pleased to have exceeded our leverage target for the year driven by both growth and very strong operating cash flows exiting the year.

BrightSpring is well positioned with a strong balance sheet, enabling increased capital allocation flexibility in 2026 and beyond. Longer term, with continued execution, growth and cash flow generation, we remain on track towards a leverage target of 2.5x or below which, at current trends, could be realized by midyear, excluding acquisitions or other uses of cash.

As of December 31, net debt outstanding was approximately $2.5 billion. We continue to actively evaluate our capital structure to ensure that we are best positioned moving forward. As mentioned previously, in January of last year, we expect to receive approximately $715 million of net cash proceeds from the $835 million of gross cash consideration in the pending Community Living sale, which at this time, we expect to close by the end of the first quarter. Given various moving parts with regards to the use of Community Living proceeds, we are not providing interest expense guidance at this point in time.

Turning to guidance for 2026, which excludes the Community Living business as well as any acquisitions that have not yet closed. Total revenue is expected to be in the range of $14.45 billion to $15.0 billion, including Pharmacy Solutions revenue of $12.6 billion to $13.1 billion and Provider Services revenue of $1.85 billion to $1.9 billion. This revenue range reflects 11.9% to 16.2% growth over full year 2025, excluding Community Living in both years.

Total adjusted EBITDA is expected to be in the range of $760 million to $790 million for full year 2026. This would reflect 23.1% to 27.9% growth over full year 2025 excluding Community Living in both years. Included in total adjusted EBITDA is expected contribution from the Amedisys and LHC acquisition of $30 million.

I will now turn it back to Jon.

Thanks, Jen, and thank you for your time today to go through BrightSpring's Fourth Quarter and Full Year 2025 results. We'll now open up the call for questions. Operator?

[Operator Instructions] Our first question is going to come from the line of A.J. Rice with UBS.

Obviously, a lot of things are going well for the company at this point. When you look at your '26 outlook, I wonder if you could just maybe at a high level talk through a little bit about where are the points of variability in your forecast when you think about the greatest swing factor that could create upside or create challenges for you. What would you highlight?

A.J, thank you for the question. As we sit here right now, we see a lot of consistency that's playing out as we look at 2025. So we don't see a whole lot of changes and are continuing just to try to execute against the strategies that we've been driving for a while. I mean as we look out for the year and try to ensure execution, continuing to drive volume growth in each of the businesses is going to be important. We're making sales investments really, as always, in all of the businesses, in particular in a couple of them like Home Health, hospice and Infusion and Home & Community in select markets like IBD and ALS.

So seeing those sales investments take hold, as always, we have a fulsome list of Lean Sigma, tech and now increasingly, AI projects that are slated to roll out through the company this year. We expect benefit from those as well. And then as we integrate the Amedisys and LHC acquisitions, those will be important to do well this year. So look, I think it's just continued execution from a quality standpoint and, with that quality, investing more and more in sales to drive to our volume targets. And then on the cost side, continuing to drive lean initiatives through technology and through our procurement team.

Obviously, there's some margin expansion in what we're expecting for this year. But all those items are things we've been executing against for a long time. And I think we want to take the consistency we're seeing right now and just continue to execute from a volume and a margin perspective.

Okay. And maybe for the follow-up, I know you said that over the next 12 to 18 months, you're looking at 16 to 20 new LDD introductions. I wondered -- give us some comments about the landscape from a generic conversion, biosimilar conversion and what that looks like for you at this point?

Yes. We actually had 24 LDDs we won last year. And 16 to 20 is our guidepost. We've been beating that in the last year or 2. We feel like that's a really good number as we look out 12 to 18 months. The team is just doing a great job. Again, from a quality and service level perspective, that's something we focus on immensely to try to be the best partner we can.

I think importantly, we are winning rare and orphan and some LDDs outside of oncology as well. We'll have probably 3 or 4 infusion LDDs, for example, that we're going to be winning here in Q1 or early Q2, and that's an area we're really focusing on, and then even a very meaningful cardiac drug here recently that we picked up, too. So our LDD and specialty strategy is continuing to, I would say, expand, leveraging on the core capabilities that we have. And that's exciting.

From a biosimilar perspective, with STELARA mostly in the rearview mirror, there's a little bit of residual impact for us this year. But we really don't have any exposure there just given the nature of the therapies and the drugs that we supply.

Our next question will come from the line of Whit Mayo with Leerink Partners.

John or Jen, can you talk about just EBITDA and margins for each of the segments expected for this year?

Yes, sure. I'll go ahead and turn that over to Jen in a second. Yes, I would just say, as you're seeing EBITDA in our guide thus far for 2026 outpace revenue, obviously, there's some margin expansion there. From a revenue perspective, some things that were expected, you've got IRA, you've got some branded generic conversions. You've got a little bit of residual impact from a customer too in Home & Community Pharmacy that we either fired or they went bankrupt.

And so that's at play in some of our revenue numbers, notwithstanding that really strong growth rate numbers for the year that we're really confident in. I think some of the EBITDA drivers said before is going to be some product mix and then these operational efficiencies that we continue to drive. Providers got a really good growth number for 2026. That's a 17% margin business as well. So Jen, any other commentary at the segment level?

Yes. I would say from a segment standpoint, we do expect broad-based margin expansion from the initiatives that we've deployed in late 2025 and continuing into 2026. So we do expect some of that. We have favorable mix both in terms of products and services that is benefiting that. Jon mentioned some of the revenue impact that also is causing expansion from a margin perspective, from an EBITDA standpoint.

But just with all that, we continue to invest for future growth. So in our plan for 2026, we will continue our investments in AI and technologies and other operational processes and sales investments, as Jon has mentioned. So we are going to be covering that in this revenue guide as well.

Yes. I think that's an important point. I mean, even sort of with the EBITDA guide for '26, which I think it's 27%, 28% at the high end. There's a lot of continual investment we're making in the company as we look out to 1, 3-and 5-year growth, which we're really excited about.

Okay. And then I'm curious, just your views on the future of the temporary and permanent behavioral adjustment cuts for home health now that you've really doubled down on industry. There's some debate whether or not CMS will, in fact, move forward to implement any further cuts. So I mean you may have kind of, call it, bottomed here on the rate environment in some ways. So I'm just curious how you're looking at the rate environment.

Yes. We like home health a lot. I mean that deal was such an incredible set from a geographical perspective. Our baseline with home health rates, just to be conservative, is flat. I think there's been a lot of constructive conversations even here recently around the future and the value of home health. So we do remain optimistic. And just given the landscape of what's happened with some of the providers I mean, we see an unbelievable runway in home health and hospice over the next 5 to 10 years. And our base case is flat. And I think if certain things occur in the future, there could be positivity there and back to normal and expected and justified rate increases.

Remember, home health for us is sort of still sitting around 10% or so of the company. And then hospice has obviously had a ton of support and has been a phenomenal performer for us. Both of those teams in our company have best-in-class management. We continue to add to sales. We continue to drive technology into those businesses, and super excited about their prospects.

[Operator Instructions] Our next question comes from the line of David Larsen with BTIG.

Congratulations on the great year. Can you talk a little bit about the earnings impact on specialty when drugs launched generic? It's my understanding that even though the price can decline, your margins would improve with generic launches. You're able to negotiate better margins across product classes when that happens. Just any numbers around that would be very helpful, if that's the case.

David, yes, look, in the Specialty Pharmacy business, that growth is multifactorial and it's been working for a decade now. You've got brand LDDs. We continue to win about 20 of those a year. We're continuing to actually expand outside of oncology and a lot of rare and orphan conditions, which is exciting. The pipeline out there in pharma continues to never be more innovative and bigger. Some of these therapeutics are amazing for what they can do for people.

But you've got brand LDDs. You've got a healthy stream of brands converting generic over time. That's a great thing for everybody. We drive generic utilization as much as we can. Obviously, the cost on the buy side and procurement comes down, and that's helpful. And then we have a really growing fee-for-service business. We have a lot of data agreements and other service agreements with pharma. We're up to over 30 hubs now, where we're the hub for pharma.

And so just a terrific business in terms of the fee-for-service side. And that's obviously a higher gross profit margin as well. So we like the multifactorial nature of growth in that business and we continue to lean into all of them.

Our next question comes from the line of Charles Rhyee with TD Cowen.

Maybe just a follow-up from Whit's question, just at least thinking through for the segments related to the overall EBITDA guidance. Obviously, with the Provider segment, we're going to add in sort of the $30 million contribution from the Amedisys transaction here. But beyond that, if we look at sort of either the '25 full year performance for the segments versus maybe fourth quarter, anything that would suggest that the trends that we're seeing in either that we should take account in our modeling as we think about how to proportion sort of the overall EBITDA between the segments?

We expect consistency with what we saw in 2025. So we will continue to see volume growth, and EBITDA growth is our expectation organically across both of our segments.

Our next question will come from the line of Jared Haase with William Blair.

Yes. Just wanted to drill in a little bit more. Just I wanted to understand the margin profile of the Amedisys assets that you acquired. From your comments, it sounds like that's a high single-digit margin if I use the pro forma revenues and then the $30 million EBITDA contribution, which, I guess, seems to be a little bit on the lower side compared to peers in the space and the rest of your like Provider segment.

So just wanted to kind of understand, make sure um thinking about margins for that asset correctly. And I'm wondering you're sort of absorbing any integration or transformation-related costs post that acquisition in the near term.

Jared, I'll let Jen speak in a second. No, look, I think you're largely doing that math correctly in terms of what we acquired. It is what it is. But as we look out for the year, that would be something that we would hope to integrate very soundly. And as we step through the year, we'll see how it's going. We have a margin that's higher than that, and our goals will be to drive to our margin over time. And I think we will look to see how quickly we can do that.

I would agree. There's a lot of integration work and technology investments that we're making, ensuring everyone's on consistent platforms and systems, a number of travel initiatives and other things. So we're really excited about that asset and what that will bring. And again, as Jon mentioned, we are very excited about moving that towards our overall profile.

Yes. I think the only question hopefully will be the timeline of that. And if it moves up, it moves up. And that's a good thing.

Our next question comes from the line of Brian Tanquilut with Jefferies.

Congrats on the quarter, guys. Maybe, Jen, as I think through the year, any callouts, especially with the Amed transaction coming in and kind of like a margin ramp expectation there, any call out on how we should think about the cadence of the quarters for 2026?

Yes. Really great question, Brian. Thank you. Just as a reminder, Q1 is the shortest quarter from a day's perspective. So that tends to be from an annualized perspective our lowest quarter. We would expect sequential growth in each of our quarters throughout 2026 consistent with what we saw in 2025. And from a margin perspective, that will be driven really kind of throughout the year as well as we have different products coming online. We have a generic launch that will happen in Q2. So that will increase throughout the year from a margin perspective.

Our next question will come from the line of Pito Chickering with Deutsche Bank.

Great quarter here. Looking at the 2026 Pharmacy revenue guidance, can you give us the moving parts between sort of core growth of existing drugs plus new LDD wins and the offsets from generic conversions? And obviously, generics is obviously revenue and obviously not EBITDA. But if you can just give us how we think about core growing plus LDD wins minus generics to help get to the pharmacy revenue guidance.

Yes. So maybe I'll just start with a couple of unfavorable impacts. I think that will be helpful context. So as you think about IRA in Specialty and Infusion, we do have a revenue headwind of approximately $200 million. And then brand to generic conversions, as we've talked throughout 2025, we typically are trying to increase our sales in advance of a launch. And as we know when there's a brand to generic conversion, revenue does come down, and then ultimately, that is good for everyone. It is beneficial from an EBITDA standpoint for us.

The total impact in Specialty and Infusion is a little over $400 million between those 2 items. And then Home & Community IRA impact from a revenue standpoint is approximately $175 million. So we do have headwinds of approximately $600 million in 2026. Despite that, we obviously have strong growth. We do expect growth across all of our different business lines. We will absolutely have LDD growth, that in specialty. We have strong script growth in home infusion and specialty plans.

We mentioned in Q3 that Home & Community script growth will be challenged because of the year-over-year lapping of some of the customers that we off-boarded or the branches associated with that customer that went through bankruptcy and those locations. In Home & Community, we will have script challenges until about Q3, but outside of that we are having really strong volume growth across each of our Pharmacy businesses.

Our next question comes from the line of Ann Hynes with Mizuho.

Can you provide an update on the Infusion business? I know it's been a big focus of investment in growth. Maybe how much that grew within specialty, what the margin profile is and maybe what it contributes now as a percent of total specialty.

Yes. Ann, we're pleased with where the Infusion business is at. We have really high aspirations for it this year and going forward. The acute business, we're really a top 2 provider in the country there and in a lot of markets have a leading market share. That growth has been in the double digits and we're optimistic that will occur again this year.

On the specialty side is, I think, where we have a big opportunity. We've been underweight on specialty. We're creating specialty hubs right now and really separating those 2 businesses out to create the focus that we want. We've invested in a lot of resources there. We're going to be further investing in resources. We have plans to significantly expand our AIS presence. We've got about 30 right now. We're going to be retrofitting those and upgrading them and moving locations all this year and trying to make them extremely consumer-friendly and all the right kind of strip malls and places. So super excited about it. As you look at our balance sheet, that gives us a lot more flexibility in the future as well.

And then just kind of broadly, just touching back on Pito's question. When you think about the numbers Jen put out there sort of those onetime impacts, that otherwise is calculating to a revenue outlook at this time for 2026 of at 20% or a little bit over 20% when you adjust for those items. So really robust broadly outside of a couple of those external items.

And then I just wanted to circle back on Brian's note on the cadence for the year. It's a great question. I mean, as Jen said, we do expect the quarters do increase throughout the year. As I sort of mentioned to A.J., the continual sales investments we're making all on the back of quality, de novos that we're investing in and then our operational projects, these things are all ongoing throughout the year. And as such, those are some of the growth drivers we see throughout the year as we sit here today.

Our next question will come from the line of Matthew Gillmor with KeyBanc.

I wanted to ask about the Onco360 sales force. It seems like a pretty unique asset within the specialty pharmacy platform. Can you remind us the role they play, especially with LDD launches or with generic conversions? And what are the priorities for that part of the business as you're thinking about 2026?

Yes. No, that's an area that we've continued to invest in, a lot of long-standing relationships, both with pharma and with prescribers, which we take extremely seriously and are very honored to have. But it's an area that we give a lot of attention. We've increased our investments in that field force every year. We'll do it again this year.

We're essentially at this point covering, I think, every geography in the United States from a rural standpoint. And again, it's the service levels that are really pulled through behind the commitments by the field force that are so important. And those are all reflected in the Net Promoter Scores that we have, which typically range between 95% to 100%.

So everything starts with service. And from there, it's just trying to offer the best education and support for all of the stakeholders out there in the market that we can.

Our next question will come from the line of Joanna Gajuk with Bank of America.

If I may ask the question a little bit differently about the segment. So I appreciate the $600 million revenue headwind in in the Pharmacy segment. So if I look at 2025 Pharmacy segment margins, like they improved actually a little bit year-over-year, the 4.7%, call it, in '25. Is that the way to think about '26 margins for this segment? How, I guess, these revenue headwinds translating into the margin for that segment?

Yes. Thank you, Joanna. Yes. It would be mix shift, it would be operational improvements, offset by the investments that we're going to be making as we had mentioned in each of the different segments and at corporate in those areas. So again, we would absolutely expect an improvement in margins. You see that coming through and you start to see that in Q4. You see that margin move up. We'll expect a small improvement of that that's continuing through 2026 and, again, for those particular reasons,

Yes. In addition to the mix shift and the operational initiatives, you've got economies of scale just from really robust just core growth.

Our next question will come from the line of Raj Kumar with Stephens.

Maybe just kind of banding up on the kind of the integration milestones with Amedisys, LHC and thinking about that beyond 2026. And maybe kind of fleshing out the embedded value you see with the asset integration and then cross-integration of services and products between both segments considering the deeper kind of geographical overlap post deal kind of would be helpful to kind of see or frame the overall kind of story there.

Yes. So I think there was an earlier question about the margin structure that we acquired. Our Provider margins, you can look at what they are. That's what our hope is for the business. And I think we just have to see how quickly we can get there. I would say we're very optimistic about the top line growth and the volume and ADC growth as well and the potential that we have in the business.

The assimilation so far has gone incredibly well. From a cultural standpoint, fantastic. And so we're really excited about it. There's margin opportunity there. But we're as excited and even more excited about what we can do from a growth perspective in some of these really terrific markets. I would say that there's also overlap with our hospice branches. And so there's going to be a lot of integrated care opportunities there as well and benefits for our hospice business, too.

I would note that we funded that deal entirely with cash on hand, and I think that's just a little bit of a call out to where our balance sheet and our cash profile is today. We ended up the year at almost $500 million of operating cash flow. We also did a repurchase later in the year. And as we look at our balance sheet, under 3x now, and pro forma for the Community Living close, 2.6x. So it's, I think, the ability to execute against that transaction entirely funded with cash on hand was a helpful benefit of where we've come as a company from a balance sheet perspective.

And where we sit today and, as mentioned, I think that's going to give us some flexibility as we go forward, particularly later in the year and certainly into '27 and '28.

Our next question comes from the line of Stephen Baxter with Wells Fargo.

Some strong growth rates here. And I think that actually includes potentially stepping over a fairly large headwind in the LTC business. It's coming off the changes that are being made around the IRA. I was wondering if you could update us maybe on the magnitude of the headwind there that you're stepping over. And then any update on your efforts to maybe offset that headwind through reimbursement changes or additional fees or things like that.

Yes. So as we discussed last quarter, we continue to work and continue to work productively with our payers regarding an enhanced dispensing fee that we have worked to achieve, which has helped us to mitigate some of the impact. There, we absolutely do have an impact, and we continue to work through that from a payer perspective. But through all of the other growth initiatives, the volume growth, the operational efficiencies, we have growth planned as we had discussed, healthy growth plan in the Home & Community business.

So we continue to work again productively with our payers to ensure that we have an appropriate enhanced dispensing fee. Our government relations team is also active, making sure that everyone understands the impacts to the Pharmacy business. But again, our scale platform and our operational improvement that are hallmark really to how we're approaching every single year, I think, have helped us in this year for 2026.

Yes. I think, hopefully, we've been clear on the growth drivers for specialty across LDDs, brand, generic, fee-for-service, infusion. You've got acute. You've got specialty. You've got a growing LDD business there, roll out of more AISs in Home & Community Pharmacy, outside of this IRA, which we'll work through constructively, and you've got 1 or 2 customer situations, unfortunately, which will be in the rearview mirror probably by about Q3 or Q4. I mean the name of the game in that business is driving as much volume as you can in these other attractive end markets and being the most efficient scale provider in the industry.

So you look at assisted living, you look at hospice, you look at behavioral, you look at the PACE market we're entering and then the skilled nursing market with a segment of that market, all extremely attractive. I mean, we're adding some 30 reps this year to grow and penetrate across all those markets further. And then this is where we are leaning into AI and technology the most for starters. You look at the whole pharmacy intake and revenue cycle project process, and there are some 7 or 8 projects this year.

So super excited about continuing to build out the biggest scaled independent provider in that space in these attractive end markets and providing a set of operations that produce the highest service level as possible and with a continued focus on cost per script there.

Our next question comes from the line of Sean Dodge with BMO Capital Markets.

Maybe just going back to the margin comments on the Pharmacy side. You mentioned some of the key drivers having been your efficiency efforts and then product mix. Could you just give us a sense of the margin expansion you drove over the last year, how much of that was from generics versus how much of that was from those cost initiatives? And then we think about the '26 guidance, the improving margins you're embedding there. Is that proportionality expected to change at all? How favorable do you expect incremental efficiencies to play into that again versus lift from the generics?

Yes. I mean, well, look, the good news on operational efficiencies as a lot of them occurred in the back half of last year. So they're just sort of flowing through at this point and will be year-over-year tailwinds. And then in addition to that, we're always looking at the next thing and launching new projects. I would say on the Pharmacy side, Home & Community and Infusion is where we have the most projects from an operational excellence perspective going on and will be going on this year.

But from a margin perspective, I mean, yes, economies of scale from pretty aggressive growth targets that we like to put out there and go try to achieve. But look, across all the different businesses, you've got brands and generics in each. You've got a lot of different end markets, a lot of different payers. I mean, there's just a lot going on. But the net effect of it every year, if you focus on strong, strong double-digit growth, market share gains, targeting the most attractive therapeutic areas and doing all of that with the best quality and the most operational efficiency, that's always net out to a really good place.

The hallmarks of the company now for 10 years has been volume and efficiency and then accretive M&A. And so that story has really never been more intact, and you see all of that play through in 2026, we think, as we sit here today.

Thank you. I'm showing no further questions, I would like to hand the conference back over to Jon Rousseau for closing remarks.

Thank you, everybody, for joining. We really appreciate it. Appreciate your questions, as always. And have a great day, and we look forward to talking with you soon.

This concludes today's conference call. Thank you for participating, and you may now disconnect. Everyone, have a great day.

Ladies and gentlemen, the program is about to begin. At this time, it is my pleasure to turn the program over to your host, Joanna Gajuk. Thank you.

Good morning, everyone. Thanks so much for joining us for the fifth annual Home Care Conference that I'm hosting today.

And now it's my pleasure to host this session with BrightSpring. They're one of the largest diversified home care providers in the U.S. And today with us in 1 room is Jon Rousseau, President and CEO; and also Jen Phipps, the CFO, join us. So thanks so much for joining.

And a note to the audience. I have a list of questions, so we're going to jump right into those, but if you want to ask your question, please use the Ask a Question window in the webcast panel, and I'll be more than happy to add that to my list as well.

So thanks, Jon and Jen, for joining us. So maybe just let's start with specialty pharma. Clearly, that business continues to surprise to the upside, right? The most recent guidance, when you compare to the initial guidance for the Pharmacy segment, right, the biggest segment, is almost like 9% or so higher than the initial guidance. So can you walk us through the sources of upside there in terms of what drove this outperformance? Is this any specific therapies that came in better or just more of these new contracts coming in? So just kind of shed some light on that outperformance.

Yes. Good morning, Joanna. Thank you. Yes, I would say in terms of the year in 2025, really, surprisingly, already 11 months in at this point, wrapping up the year, but we have been able to realize and execute against a really positive and broad-based growth across the preponderance of the company. Specialty has been a business that has, I would say, outperformed the most.

But yes, I would say, big picture, we are the most pleased with the progress that we've continued to make across the entirety of the organization, in our 3 Pharmacy businesses and then our 3 main Provider businesses in home health and in hospice and in rehab, in addition to really continuing to focus on operational process and lean and now AI initiatives in the organization.

So the 3 growth drivers historically of outsized volume growth: efficiency, leveraging the scale of the organization and accretive M&A, that has very much continued to be themes throughout now our ninth year here, and we expect those to continue into next year. Specialty has been a larger growth driver for us this year. It's been underpinned as always by really 3 things.

Number one, the service levels that we've invested in, which have resulted, I think even in the most recent quarter here, the pulsing of the Net Promoter Score in the industry, I think it was a 96 Net Promoter Score from our customers most recently. Just continuing to invest into our people and our processes to drive service levels that are at the highest possible levels for all of our manufacturing partners and our patients and the members of the payers and the PBMs that we serve.

I would say second, longstanding relationships and partnerships with manufacturers that, in addition to the service levels, that we're able to execute against a lot of features and programs that we have with biopharma upstream, that I think are very helpful and valuable to them.

And then really third, we've continued to invest in clinical liaison, several hundred out in the field every day educating and working with prescribers and patients and families, to really pull through the referrals to our pharmacy to try to get those patients and their prescribers the best possible experience.

And so those 3 underpinnings of the business have just continued to drive a very healthy year of partnering with our manufacturers as they deliver innovative new therapies, life-changing therapies to the market, and being able to be a chosen 1 or 2 pharmacy in-network, in these limited distribution networks, with the manufacturing partners.

I think at this point there's been some 16 or 17 new drugs that have been launched this year where we've been a partner as an exclusive or 1 of 2 pharmacies in those networks. That's been a little bit of an acceleration versus the historical level of launches every year. But that's been good to see and great to see the innovation in the oncology pipeline continue. We do not see that changing in the near future. I think there's still some $90 billion of drugs at the FDA that are hopefully expected to come to market over the next 5 to 7 years.

As certain drugs have also gone off of their branded status over time and have converted to generic, starting a couple of years ago, there were several drugs every year that were going to be going through that life cycle. We've continued to see that play out, and we do our best to drive generic utilization for prescribers and families when we see these events happening. And that's been helpful this year as well.

I would say too, something that we probably spend less time talking about or get questions on, is our fee-for-service business continues to grow. These are a product of something I mentioned before around our programs with biopharma, but whether it's data agreements or clinical hubs that we're able to offer back to pharma, that's something that we've continued to invest in, and we've continued to grow. I think we're up to 15 clinical hubs now. And we have service and data and agreements back with every one of our manufacturing partners as well. And so that's continued to be meaningful for us.

And then our OpEx per script. We've done, I think, a really nice job as the volume has continued to increase some 30% plus a year, we've done a really nice job continuing to execute against an efficient internal process that delivers on really good service levels, but where we're seeing our OpEx per script continue to benefit.

There's a lot of things to unpack there. But I guess the interesting comment around the fee-for-service business and such. So would you say that that's -- there was another kind of acceleration this year that you've seen that would explain maybe some of it? I mean it sounds like there was maybe more than usual in terms of new launches and things in generic conversions, but it sounds like maybe this fee-for-service business is growing also pretty rapidly. So is there some new push that you did this year?

No. I mean that's just something that we've been really trying to build out over time. I mean that's probably seeing sort of 40-ish, 50-ish percent growth this year in GP. And it's still comparatively significantly smaller than just the core revenue and GP on any of the therapies. But that has been very much of a specific focus for our team and trying to build out as valuable a set of sort of offerings as we can for all of the manufacturing partners upstream and trying to differentiate in that way.

So it has been a focus. And we've probably seen growth in that area, albeit smaller part of our business, we have seen growth in that area be a little bit higher than the growth in the total business. And that's something that will stay front and center for us.

Right. And to that point, the specialty pharmacy revenue has been growing, like you said, 40% or so year-to-date, and on top of 40% last year and 30% in '23. So essentially, the question is like, how much longer can you grow at these levels, at these percentages, I guess?

Yes. Look, I mean, that's obviously really been a function of when you look at that growth rate versus the growth rate of a therapeutic category and specialty writ large, it is higher. But you really have to break down the different segments, I would say, of the industry and the value chain. About half of specialty products go through hospitals and about the other half goes through the specialty pharmacy, the SP segment, where we are. And then you really have to ultimately go therapy by therapy.

And so based on the investments that we've been making and our commitment to service levels and programs, when new drugs have been coming to market, and we've been really honored to win the preponderance of those in limited networks, that's obviously having a disproportionate effect on market share in terms of the flow of innovative new therapies coming to market and participating in those. Comparatively, that's having a positive effect from a market share perspective.

Also good for everybody, our generics. And as generics have converted, we really do our best with our sales force out there every day to educate and help be a quick partner to bring those therapies to offices and their patients and families. And so I think those are the things that have been helpful in driving a growth rate that's been higher than the industry.

Look, I think as we look out to some more of the brands converting to generic in the future, we continue to see a very steady and healthy stream of innovative new products coming to market. So I don't know that we see any fundamental changes to therapies and LDDs coming to market. But I would say some of the brands that have converted to generic, when you look back historically, have been some of the more significant brands. And while there are more brands converting to generic in the future, I don't know that the magnitude of that might be quite as significant.

So look, part of it too is just the math. As a business continues to scale, are you able to grow at certain rates? I mean if you look at the history of health services, frankly, anything more than 5% to 6% growth rate and you're kind of a hero, particularly at size. I think when we were going public, if I'm remembering now, flashback, I think all of our advisers told us that there was one other company that had been north of $400 million of EBITDA that had a 3 to 5 or 7-year CAGR that was higher, that was in double digits.

And so it's certainly not only growing at our historical CAGR of 15% when we went public, now that's been elevated based on the last couple of years. We already thought that that was a pretty strong performance and in rarefied air to begin with. Being able to grow with some of the rates here over the last 2 years and into the 30s this year, I just think from a scale and a math perspective, that becomes extremely difficult as you continue getting bigger and bigger and bigger. And I don't even think that that would be expected.

But for us, continuing to target our historical CAGR at 15% a year, that's exactly what we want to do. Driving the opportunities we have across many of our businesses where we operate in huge markets that are still very fragmented. Our focus here is just continuing to deepen in every one of our markets and every one of our businesses, and then continuing to expand into adjacent geographies. And when you look at our businesses and the size of these markets, that takes you a really long way. I mean we look at a lot of our businesses and think most of them can be double or triple where they are now in 5 to 7 years. And that's our focus and that's what we keep trying to execute on through investments in people, technology and quality and sales and marketing.

So as we sit here today, barring anything unexpected, we see our current performance in Q4 being consistent with earlier parts of the year, and we don't see that changing into next year. But as you look out beyond next year and 3 to 5 years from now, it just gets very difficult and there's just a lot of unknowns obviously in the world where we're reticent to sort of make those sort of long-term projections vis-a-vis current growth rates.

But we are committed to and feel good about growing at our historical CAGR into the future. And I think our scale has been very helpful from a cash and a leverage perspective. We're excited about that going forward. And we will always continue to try to do our best. And if we have years where we have more elevated growth rates, that's great. But we're -- in addition to being able to grow, what we've done more than anything this year is continue to try to table-set, right? We're investing heavily into IT and AI. We continue to invest in key positions and people to try to grow 3, 5 years out.

And I guess when it comes to, like you said, growing faster than some of these end markets, so is there any speculation who you're taking share from? I mean it's highly likely the smaller guys. But any kind of indications of where are you, I guess, taking share from? And I guess to that point, there's obviously interest in oncology from others too, and I guess the question is, would you be interested in, say, owning oncology clinics at all?

Yes. We just continue to try to keep our head down from a service level and a programmatic standpoint, partnering with everybody across the value chain. And as we continue to be, hopefully, a value-add partner, as new therapies are coming to market, that's really been at the core. I think of our growth rate along with being able to try to bring new generic therapies to patients and families as fast as we can. And that's really been the function there.

In terms of the oncologists out there, obviously, that's been an active space among some of the wholesalers and others. For us, I think we really just view that as being the best partner we possibly can. From a daily education, daily support perspective, hundreds of our liaisons out in thousands and thousands of offices every day. We've got 10 to 15-year relationships or more in most cases. And could we be the best possible partner to help all of those prescribers achieve their goals and their outcomes, objectives? That's really our focus today.

And maybe, you mentioned the pipeline of new drugs, the $90 billion or so, so kind of -- can you help us also understand the 2 forces that you said? There's the new pipeline of drugs, but there's the generic conversion. So kind of when you put those things together, how should we think about the revenue, I guess, squaring those 2 forces, right?

And also, can you here maybe talk a little bit more about these generic conversions? It sounds like you're thinking that kind of the dollars in terms of the branded conversions are kind of maybe smaller than maybe what you experienced the last couple of years.

Well, it's, I guess, just very healthy in pharma that you always -- in any therapeutic category and just the history of pharma has been there's a ton of innovation, the same thing for other parts of health care, there's just a ton of innovation that continues to occur, thankfully. And there's patents for that and then, over time, those will expire, and then things convert generic.

So that's going to continue to play out. And it will just always create this complementary dynamic of new innovative therapies coming to market with older brands rolling off. And that will just continue out into the future for a long period of time. That's how the industry works.

We are seeing biopharma continue to be even more innovative and more specialized, a little bit more niche in the therapies for target patient populations that they're bringing to market. And there's some really interesting rare and orphan therapies that are coming to market that are incredibly impactful for these populations of individuals with these conditions. But you're seeing a lot of that and just more and more innovation upstream in biopharma.

So that's exciting. It is a little bit more niche in the approach. But we will continue to try to do everything we can to be a partner in all of these areas, even things like cell and gene therapy. So always trying to stay ahead of what's happening next, looking out 3, 4, 5 years.

And yes, some of the generics in the past couple of years that have launched have been some of the really big brands. But you look out even 5 years from now, IMBRUVICA is a huge brand drug that will convert even 5 years out. So there will be continued conversions well out into the future. And I mean, look, it's just natural. Some drugs that are launching are bigger and smaller; some drugs that are converting are bigger than smaller. So your growth rate is going to bounce around. But the fundamental underpinning of the dynamics of the market, I think, is really interesting for a long time.

And I guess when we talk about these generic conversions as such, we can see the other metric, you mentioned the OpEx per script. But gross profit per script, right, has been growing very nicely. So it sounds like that's benefiting from the generic conversions you alluded to. So can you walk us through how quickly gross margin percentages improve after a conversion? And kind of any other dynamics around these conversions in terms of how we think about the timing of when those things flow through into your economics?

Yes. I mean, and I think part of the GP, I think maybe it's been about 1 point over the last year or 2, I mean, part of that has also been from some of these fee-for-service programs and offerings that we have. So that's in that number too. And we've been real focused on that. But...

I think as well the mix of specialty, so specialty has grown at a faster pace than, for example, our home and community pharmacy. And as that has grown at a faster pace from a script standpoint, from a percentage, that does impact as well just from a mix standpoint. Just like the revenue growth as well has skewed higher, that has been a function of higher specialty growth.

Yes. And part, I guess, of your specialty is also infusion, right? It sounds like that's the next area of outsized growth. Did you expect -- I mean, I guess you're starting with a smaller base, right? Can you walk us through kind of how you envision that? And does this require more investments to really kind of execute on the 20% growth that you alluded to that you expect in EBITDA in that piece?

Yes. No, it's a great question. Infusion is a business that we are enthused about. We've talked a little bit about how that one's been a little bit more sideways in the last 2 years. And as we've gone through, I guess, I would call it a reengineering of the business, if you will. Maybe for those who haven't heard that story, infusion, always a great reputation, good business, good quality, 95% customer satisfaction, patients finishing their therapy with us. Really good quality.

But when we came together with PharMerica, hard to believe, 6.5 years ago, that was just one of the businesses that we kind of rolled up the sleeves as we just worked through an order we just got to at the end of the line a couple of years ago. And for 30 years, they had just set up their pharmacies locally and they were all operating kind of their own way.

And just in terms of being able to scale -- and that, in a lot of ways, that's productive. I mean you have to have a local approach. But you can very much also standardize around best practice. And so that's what we wanted to do immediately and to be able to scale the business just faster. Because the volume growth was there, but the costs were really increasing too. And so getting more control and getting more standardization was the focus.

And as you may be able to imagine, you can't just snap your fingers and change a process that's been in place for 30 years across 35 locations. So that's been about a 2-year effort, but I can say right now it's gone well in terms of where we are today. Their third quarter was a very good quarter. We're starting to see it finally flow through the financials in terms of not only good volume growth, but now that volume growth being executed against in a more efficient manner. Q4 will be another good quarter.

I mean we're going through finalization of budgets here, but look, they're down on the budget to be growing well over 30%, 35% next year from an EBITDA perspective. Now it's on a lower number, but we have very ambitious goals for that business. We're looking at both acute and specialty.

A lot of folks in the infusion world, probably with the exception of the big public player who we have a lot of respect for, a lot of folks really just focus on a handful of niche therapies or specialty and chronic drugs. We really want to also focus on acute as much as we can. That's a huge market.

Acute therapies, there won't be a lot of change with them. They're nowhere on the radar screen. There's no -- from a pricing perspective, there's no biosimilar risk there. And so we continue to want to go deep on acute, while we also -- and that's where our history has more been. And so for us, when you look at the chronic specialty side, where a lot of the smaller companies have really tried to focus on, we haven't had as much history there. So we are focused on building out some of the chronic therapies as well. And we're excited about both of those worlds: acute and chronic in specialty.

We are sort of reinventing, if you will, 30 of our AISs, some of the clinic and suite settings, making them more consumer-friendly. But we want to have many, many, many more of those over the next 5 years. So for us, we're taking an approach of acute and chronic in the home and in suites, and we think that gives us the biggest addressable market. We think that gives us the most relevance with payers. And we have a really great team in there, really since the early part of end of Q1 of this year, that's doing a really nice job.

So super excited about the business. We think infusion is a great market, provides incredibly valuable services. At some point, Medicare patients, that Cures Act, I think, will get remedied and fixed, so that more Medicare patients can be seen in the home like they should. And we're seeing some good momentum in that business. We've had just a real focus on operational process around the model. And we're probably in the seventh inning of that, but some good momentum there. I think in a lot of ways that could be one of our highest growth businesses here, if not the highest growth over the next 5 to 7 years.

And I guess in order to do that, I mean, it sounds like you have a nice footprint when it comes to pharmacies, so do you anticipate the need to acquire more assets? Or will this be more de novos? And I guess on labor, is your model in terms of employing the nurses that go into homes or you use the third-party staffing?

Yes. I think it will be consistent with what I said before, both penetration of where you are. I mean there are some states where we could have 10x the share, like where we're scratching the surface. I mean we've got 6 or 7 states in particular where we're pretty deep, but we can do a lot more where we are. And then we will absolutely look to expand probably to 6 or 7 more states in particular. There's some really big states out there where we don't have a presence yet. So it's both a go-deeper and go-broader strategy, like for all of our businesses. And that's exciting.

And from a labor perspective, we're -- 90% our own nurses. We try to contract as little as we can.

Terrific. That's helpful. And I guess on the other piece of your Pharmacy business, the home community pharmacy, a couple of headwinds, I guess, this year from the bankruptcy of Genesis and such. But should we expect a little bit of overhang into next year from that? And also, can you talk about the core growth in that business?

Yes. That and, obviously, IRA are the headwinds in that business. Outside of those 2 things, the business is doing awesome. And so, look, we just continue to focus on controlling what we can, trying to work with the good guys out there, and making sure that we ultimately have the most cost optimized, efficient operational infrastructure and processes that we can.

I would say in the whole world of automation and AI, that pharmacy intake process, pharmacy revenue cycle, that is just where a ton of our energy is right now. And super exciting to look at all of those initiatives and where we expect those to be.

Unfortunately, a lot of the benefits of that next year that we are expecting will get eaten up a little bit by any of the IRA impact, assuming IRA is not addressed. And that's still an open question, but we always plan for a certain scenario to make sure we're prepared. But a lot of progress around continued automation and AI investments in that business.

Look, we just think an LTC pharmacy, like all of pharmacy, scale is massively important. If IRA is not fixed here as it should be, it's ridiculous what IRA is potentially doing to LTC pharmacies. It really is. And it was a complete miss. And we've been educating on it for the last 2 years, but it's set to go live 1/1. The government shutdown did not help.

There is a ton of sympathy and understanding now for the issue, but there needs to be a resolution. And so we're still trying to work through that, trying to talk to people who get it, who want to do the right thing. But we are prepared either way. And that's why for the last year we've been laser focused on a ton of automation and cost initiatives. And outside of sort of the one-off Genesis-type situations, which are very unfortunate, sadly, that kind of occurs, we have really good performance from a broad customer base where we continue to be viewed as a really high-quality pharmacy out there.

But skilled nursing is only one end market within LTC pharmacy. Senior living is a great end market. Behavioral IDD is a great end market. Our hospice pharmacy is just a world-class leader in hospice pharmacy, getting into pace more and more; detox. I mean there are a lot of -- I mean, think about all the places where people, complex, acute patients need their drugs, completely different from you and me walking into CVS or Walgreens. And those are significant needs in big markets. And so there's a lot of attractive ones.

So our long-term home community pharmacy strategy is to build an infrastructure and a platform that can be the most efficient, and then execute as best we can in sales and marketing to drive as much volume across all of these end markets as we can. And we think ultimately that's going to be a winning strategy.

So any of the IRA impact, if unresolved, that is very bound within our plans for next year and we feel like we'll be able to grow through that across the breadth of our organization.

Okay. That was my follow-up question, whether you expect to grow despite the IRA. But it sounds like, yes, I guess...

Yes. Absolutely. And look, I think that's where the benefits of our scale, our complementary diversification, our accretive M&A, these are the things that have driven our organization for a long period of time. Volume growth, economies of scale driven by our platform, volume growth coming from the diversification of related businesses. You've got accretive M&A.

And that's a playbook that works, and we just have to continue to execute against those 3 underpinnings. While in the future, hopefully adding a fourth, which is more value-based care, like no risk necessarily, but shared savings. We've got to get that primary care. It's not a linchpin to our future, but it could be something that would be a really interesting adder, driving more home-based primary care, driving more patients into ACO shared saving constructs. We're still working on that too. And hopefully, that care management angle will be just an adder and a fourth growth driver as we look out into the future.

But continuing to execute against what we've seen work historically. But it takes a lot of hard work across all those fronts in each one of the businesses every day. But we see more and more the benefits of having these businesses under one umbrella and as we just continue to try to focus on operational excellence.

I guess we have only a few minutes left. But on the Provider segment, right, so hospice is the biggest piece there, right? And business there has been pretty stable. And I want to say in the past, you talked about the end market, hospice market growing 5% to 10%. So kind of how do you expect the company, the BrightSpring hospice business to grow relative to the industry? And also, is there something to be said about acquisitions?

Yes. So we do expect our provider business to continue to grow at really outsized to the volume growth that we would expect in the end markets. So that would include hospice. We are doing that by really having some of the highest quality services in each of those different business lines. And we believe that that is a critical success factor for our ability to grow in these markets as high-quality services are really important to our customers. And so we're really focused on those quality measures and we think that that's going to allow us to continue to grow.

We do see hospice continuing to grow. It has received really strong rate support, which we know -- which is beneficial. But from a volume and an ADC perspective, we continue to see and have really focus areas to go deeper in the markets that we're serving and just being able to continue to grow underpinned by those high-quality services.

Yes. Hospice is a good example where we see our patients more, considerably more, than the industry. We don't put quite as much burden on our nurses from a staffing perspective. And if we can get a really healthy culture and quality built around those things, let's try to serve as many people as we can with these incredible services.

We're also further building out our palliative program, which is a really strong program in quite a few states, and we're looking to take that into all our states by the end of this next year.

That's interesting. Okay. So there's some other things you're doing there. But if I may, on the home health piece, right? So we got the final reg out, right, that looks better, much better than proposal. But still it's a negative net update, right? So that's not great. So does that change kind of how you're thinking about that business at all? And does it change your appetite to do more acquisitions there? Because I guess now there's still something that's pending, right, in terms of the closure, but kind of after that, how you're thinking about that business and growing that.

Yes. Yes. No, look, it was very pleasing to see the final rule come out where there was some real levelheadedness and I think an example, I think a testament to CMS seeing the clear value in home health. I mean if there's anything I've seen in home health, I mean, just -- I mean, all 3. The ability for hospice to reduce costs and improve quality of living; the ability to reduce hospitalizations and ER visits with really good med management, where people are on the home and community pharmacy side; and then what home health does for mortality rates and to keep people out of hospitals. I mean it's just black and white and it's incredibly powerful data. So I think there was -- I think that rule being reined in a little bit was a testament to the value of home health.

They did say in that rule that it is the end of permanent rate cuts. So that's good as well. And we would expect rate increases in the future, except for, and we'll see what happens with any of these clawbacks, right? So that now becomes your singular issue, is what do those recoupments look like to get back at what CMS has said they believed there were overpayments back during COVID and due to some fraudsters out there.

So we'll see about that piece. But there was very good news around permanent rate cuts going away. So that will be something that will have to continue to get worked out. I think the industry needs to continue to do a better and better job of educating on the benefits of home health. We can't just keep cutting these services while costs go up 5% a year, and you have these incredible outcomes that are keeping people out of the hospital. I mean it's the exact opposite of what you should be doing. You should be funding this industry as much as you can and making sure that the ethical and highly compliant providers are not being sort of the babies being thrown out with the bathwater and some of this stuff.

So we're optimistic that longer term rates will be where they need to be. Given the value and the benefit of the industry, I think there's more and more advocacy coalescing around this. We have to use the data to continue to tell the story in black and white.

But prior to this acquisition of the divested Amedisys and LHC branches, we were very conservative in home health. I mean we had bought just a tiny amount of branches over the last 6 years, and it was an organic build. And we've just been really waiting to see what does the home health rate landscape look like in the future. And hopefully, it gets to where it used to be and where it should be, to drive the impact for the patients that they needed to reduce cost for the overall health care system. But we've been waiting to see how this plays out before making any sort of big moves.

Now the Amedisys and LHC acquisition of those divested branches, that was just a situation where we saw an opportunity to be a partner there that was so unique. The geographical fit was so hand-in-glove, it was just truly kind of a once-out-of-every-30-years sort of situation that you have that we felt like we needed to lean into. Those branches have been very well run. Historically, really high-quality star ratings. And so that's an exciting situation for us to step into.

As it relates to future acquisitions in that space, we have just a ton of acquisition opportunities across all of our businesses. I think in home health, we will continue now to wait and see what happens long term on the home health rates in the industry. And we will really focus on driving just great integration of these acquired branches here in 2026 and make sure that we achieve all of our goals around those.

Great. I think this is all the time we had. There's other things we would like to cover, but thank you so much, Jen and Jon, for joining us today. And thanks, everyone. And please stick around for next session.

Thanks, Joanna.

Thank you.

Have a good day.

All right. Thanks. Welcome, everyone, to our next presentation with BrightSpring. We're very pleased to have Jon Rousseau, President and CEO; and Jennifer Phipps, Chief Financial Officer, to talk about the company.

So, Jon, we're about 10 months into the year at this point. Do you want to just give us an assessment of year-to-date performance? What's been the positives? Have there been any challenges? Had a good year, so probably not that many challenges, but give us some flavor for that.

Sure, sure. Thanks, A.J. Good to be here. As always, good to see you. It's been a productive, constructive year for us. We've been pleased with how it's unfolded throughout the year. I would say a lot of the focus areas and initiatives that were on our plate have been well executed as we progressed throughout the quarters.

I would say really a lot of consistency through the quarters. And in the businesses themselves, really, it's been broad-based growth. So if you look across the 3 pharmacy businesses and if you look at the 3 provider businesses, it's been broad-based growth. They've all done well this year through a combination of both volume and then a lot of cost and efficiency and automation initiatives as well.

So -- and as we sit here, obviously, now already in the fourth quarter, our sights are squarely on next year, and we see a lot of the same trends and a lot of the consistency moving into next year as well.

I think we continue to benefit from being in home and community health services markets, where we experienced a lot of demand for complex and high-need individuals with really high-quality services that can be delivered in lower cost settings.

Within our markets, we've continued to invest heavily in sales and marketing on the back of really leading quality results, and that's just continued to drive a lot of volume. And more than ever, we're kind of building on our 9-year track record of focusing on the operational side. We're leaning into just more and more investments in IT, and in HR to continue to try to have the strongest foundation of operational processes that we can. So it's been a positive year. both on the volume side and on the operational side. And we just continue to think about how we can build the largest and very sustainable high-growth platform for the long term.

That's great. That's great. I know there's probably some people that are new to the BrightSpring story. Can you just remind us how you think about the long-term growth algorithm and how we think about the company in the next couple of years achieving that?

Yes. So if you look back over 9 years now, since Jen and I have been at the company, a lot of new and great people have joined us, obviously, over time. But our CAGR is right at around 15%. I would say, about 10%, 11% organic, then a couple of percent, 3%, 4% from an M&A perspective over that close to a decade.

Here more recently, in the last 3 years or so, our CAGR has been higher than that even now really around sort of 20% based on some of the growth that we've been experiencing in some of our businesses. So as we've built the scale that we have today, and we just want to continue to lean into just more and more scale. We continue to believe that scale, making the right technology, HR, process investments in this industry is going to be critical to future success, no matter what the world looks like. And so we want to continue building as much scale as we can. It's very helpful in our industries.

At some point, as you continue to be a larger and larger company, certainly, the law of numbers does kick in. We don't necessarily sit around thinking 30% growth forever is sustainable, that's extremely difficult. But I think for the foreseeable future, certainly continuing to execute at a level of our historical CAGR when you look back close to a decade in the mid-teens, that's always the base case and the minimum that we aspire to. And more recently here, if you look at our more elevated CAGR, we're hopeful that if we can get to a 20% number, we'd like to, but certainly no guarantees there just given the size of the company we have today.

And -- but look, we're always going to continue to try to invest for the future and invest for growth. We like the markets we're in and the businesses that we're in. They have a ton of value. They have a ton of ROI. The drivers of our business historically have been volume, more and more efficiency, leveraging our scale and then very accretive, mostly tuck-in M&A, and that will continue to be the playbook.

If we can augment that more with certain care management capabilities and innovative payer contracts, we will look to do that. But we're going to continue to invest on both the growth and the infrastructure side and try to keep doing our best to be at or beat that, I think, very robust historical CAGR.

That's great. When you think about '26 specifically, it was coming off a good year, like it looks like '25 will end up being, does that create a hurdle for you? Can you maintain it? Maybe just talk about headwinds and tailwinds that people should keep in mind as you think about '26?

Yes. I think, obviously, we'll probably get into more formal views that we would communicate on next year like we always have in Q1 or later in Q1, and we look forward to doing that. But it's -- I think we see a lot of consistency in the organization as we sit here today, and there are certain things that are important to get through in January and Q1. And once you kind of get into Q2 in our business, you start to get a much better sense of how the year unfolds.

So I think as we get through the first quarter, that will be very helpful. That will give us more and more insight. But as we sit here today, we see a lot of consistency. All of our pharmacy businesses are doing well. We like those businesses because they're closed door in nature, meaning we go to the customer. We serve all very complex patients with very white glove customized services for our different populations and being local like that and serving very complex patients who often have the need for life-saving and life-sustaining therapies. It's -- those businesses have good momentum now.

We've continued to invest on the operational side, particularly in areas like infusion and home and community, they have some augmented leadership teams there, and we're really excited about that. So -- and on the provider side, I would just -- a hallmark of that business has just been real predictability and consistency with, I think, best-in-class businesses. So if anything, we see good momentum and even more positivity as we think about next year, but getting into next year will be helpful.

The provider side has had really good rate stability, and we'll continue to focus on volume, as always, as we get into next year and just a ton of different cost and automation projects going on at the company today that will carry over into next year, too. So I mean, maybe just kind of the last tailwind, Jen has done a remarkable job with the balance sheet and on cash flow, and we're really proud of that over the last 2 years.

I think we probably will have a little bit more flexibility on the acquisition side. If you think about where our leverage is now, we should be at 3x or below by the end of the year, even without that potential community living divestiture finalizing. If it does, that could push us closer to 2.5x. And then as we think about cash flow next year, I think just gives us a little bit more optionality on some acquisitions. I don't think anything major, but it could be a little bit more of an adder in the future just based on where we've evolved from a balance sheet perspective.

And is there any update on the divestiture that -- and where that sits and so forth?

Jen, do you want it?

Sure. We continue to work towards that -- sorry, Community Living divestiture, I apologize. I was about to say Amedisys. We continue to work towards that. The transaction, we believe will close in Q1. That's our best view at this point in time as we're working through the specific action items that were laid out by the FTC. And so we're working with IQVIA on that.

Okay. Okay. And was that delayed somewhat by the government shutdown, I assume that had an impact?

That was probably not helpful, but we progressed through that -- we've been progressing through that process during the shutdown.

Okay. And what about -- since you mentioned that the Amedisys, that's a purchase for you guys. Where does that sit?

We expect to close that in Q4.

Okay.

So...

Is there any gating factor to getting that closed? Are you still waiting for regulatory approval, financing or anything?

Yes. It should be very high confidence view that in Q4, high confidence view, that will clear the finish line.

Okay. Maybe just on the pharmacy, Infusion Specialty revenues grew about 42% in the third quarter, you've had a great year. When you think about the different subcomponents, oncology, rare and orphan, infusion, talk about where there's been strength? Is that consistent going forward? Any comments on breaking that down a little further?

Yes. I think good momentum and good consistency really across all 3 of the businesses. You start on the Specialty oncology side in rare orphan. It's been another year where we've been honored to be selectively chosen by a lot of manufacturers and biotech in these limited drug distribution networks, typically have 1 or 2 pharmacies, keep investing in quality there. I think with outstanding results by the team and really good partnerships with everybody in the value stream, whether it's on the manufacturing side or our partners on the payer side, but a lot of access to drugs coming through the innovative pipeline of these therapies with the FDA, which remains very deep. And so a good number of product launches this year.

We continue to grow our fee-for-service business, value-add data service agreements with our upstream partners in biotech. So that's been helpful, too. As we look at next year, we would envision a similar number of new drugs coming to market and think that will look a lot like this year.

On the infusion side, as we've said before, there's a lot of companies out there that just focus on some of the Specialty chronic therapies. We really believe that a broader-based strategy that looks at the acute infusible drugs in addition to chronic infusible therapies is really important. I think that creates the most market opportunity ultimately, probably makes you the most germane with your payer partners as well, and so we've been really focusing on trying to make sure that we have the infrastructure in place to address both of those markets, and we're really pleased with our momentum in that business.

I think the infusion industry will remain a very attractive one over the long term, but importantly, you have to be operationally set up to service those patients in infusion therapy models in a very high-quality and predictable way.

And so infusion isn't the easiest thing in the world. I think there's actually some barriers to doing it very well. And so we give a lot of credit to people who do, do it well. And we've made a lot of investments in that business to get it to a place where we think it can really scale more quickly, and we're pleased with where we are today. Home and Community Pharmacy continues to service a lot of really interesting end markets.

So really just think about where patients may have a need for drugs and therapies outside of us going to Walgreens or CVS to pick them up, right? So closed door is you go to the patient and the customer wherever they are, whether that be in a senior living community, assisted living, a skilled nursing facility, somebody at home on hospice, somebody at home on home health, individuals and behavioral group home settings, hospitals, these are all places within the community where people need a customized set of services brought to them.

And so across all of those end markets, the business has been doing well. As we talked about a little bit on the last call, what was a very interesting tailwind last Q3 flipped with the Genesis bankruptcy process. And so we worked through that earlier in the year and completely accrued and have no exposure on that. That would be kind of the one headwind in that business from a volume perspective, but outside of that, when you look at the various end markets and some of the great partners that are out there, the business has a ton of momentum, and we are really leaning into as much automation as we possibly can.

Pharmacy is just an industry where very, very difficult to survive, if you just don't have tremendous and massive scale. And we've seen the benefits of that over time. It's been a necessity, and we just continue to lean into more and more of that scale. So wherever we can further penetrate a lot of these interesting growth end markets, we're going to continue to do so. And there's a lot of synergies across the entirety of the pharmacy platform in terms of our ability to contract with entities outside and deploying automation and deploying best practices.

So I think we're excited about each one of these businesses. We love what they do. They provide tremendous value for the patients where and when they need these therapies in a very customized way. And we just continue to try to invest in these businesses to foster more growth and market share.

Okay. I think just to drill down a little bit on each one of those. In the limited distribution drug pipeline, I think you came into the year thinking 16 to 18 LDDs would be introduced over the next 12 to 18 months. And then I think at one point this year, you said, well, it's actually going to happen within a year. You're saying next year looks pretty good, too. Is it the 16 to 18 over 12 to 18 months? Is that sort of a benchmark way to think about it?

That would be our best view.

Okay.

It's a very strong pipeline. We continue to see the drugs moving through -- and progressing through the pipeline, and we have been working with manufacturers. We typically have a view of what's going to come to market in the next 12 months.

I was going to ask you how much lead time you get, so it's about a year typically.

We start having conversations with manufacturers about 12 months out from the drug launch.

And when do they typically pick you to be one of their -- excuse me, is it in that time frame? Or is it a little tighter than that?

It would be within that time frame. It's not usually that far out, but we're having conversations with them about our ability to service their drugs and working with them on that, and then they would pick us closer to time.

Okay. There's just been a lot of really healthy innovation continuing in that market, give credit to a lot of the pharma and the bio companies that are bringing these therapies to market. We've seen, A.J., just a little bit more trending of niche therapies, narrowing of indication. Maybe that has to do with sort of an increased frequency, but even if we were sitting here a year ago, the data and the research talked about some $90 billion of new revenue from therapies coming on to that market over the next 5 to 6 years.

So I think the pipeline of therapies is just -- it's huge. And the innovation just continues, and we've just continued to try to position ourselves as a great partner to participate with them in that commercialization process.

And would you describe the competitive landscape for those deals is sort of steady? Or is it anything disrupted?

I would say it's very steady. I mean there's a group of 5 to 10 pharmacies that have been pharmacies in this space for quite a long period of time. And it's hard to roll the rock up to the top of the hill in this space, but once you get it there, it starts to move on the other side. And I think our team has been working for 15 years to be a trusted partner and to develop national capabilities, and I think we sort of got to that place 5 years ago. And you really do need a national presence in the scale of the 5 to 10 pharmacies in this space to be able to kind of provide the type of services that I think most manufacturers expect.

And one of the incremental drivers, not only new limited distribution drugs, but conversion of some of those drugs to biosimilar. Has that paced as you expected? I think you always said a couple of year, maybe 1 or 2 a year would be the driver, and that's almost more of a driver on the profitability line. Is that what you're seeing? Any update thoughts on that?

Yes. I would say for the services that we're in, really more from a brand to generic conversion perspective, that is always happening in pharma. I think that's healthy for the entirety of the health care ecosystem. You see dramatic reductions on the reimbursement side, but the manufacturing side opens up, too, which is very helpful. And so I mean, if you look at our business, it's kind of been a steady stream of you win 13, 14 to 16 new brands coming to market every year, working with the manufacturers as the best partner we can.

And then every year, several brands will go generic. And then third, we really have a growing fee-for-service business, partnering with biopharma. And really, those 3 things working together have ultimately sort of produced the track record that we've had over the last 5 and 10 years. And we see those sorts of numbers on the brand side, a handful of conversions a year, continuing to invest in value-add fee-for-service offerings, we see that continuing to play out fairly consistently.

And in infusion, I think you're in sort of a low single-digit national market share with a goal that over 3 to 5 years to get to 10% or so. What are the building blocks to get you to that? What needs to happen? Is your geographic footprint sufficient and you see more penetration? Do you need to expand your geographic footprint? What are some of the other things?

Yes. Yes. Infusion is a huge market. I think in the U.S., some $20 billion, $25 billion market between acute and chronic therapies. I think those are both important and relevant markets for us. We will continue to look at both of them and not just the chronic side, as you often see out there. But for us, I think it's deepening within our current markets, and it is expanding to new states.

So we have some 30 or so pharmacies locally in addition to having national distribution capability in that business, but even in those 30 markets, we could be significantly bigger, I think. And then there's 5 or 6 very material and big states out there that we still need to expand into. And then I would say, from a site of service perspective, we've got some 30 suites today where instead of infusing somebody in the home, they can go to a clinic and be seen in a suite.

We'd like to have more and more of those locations to be able to offer patients and referral sources too. So we sort of think about the business in a 2 by 2. There's the acute and the chronic market and then serving individuals either for any of those therapies in the home or in a suite or a clinic setting, which a lot of people prefer is our thoughts on the entirety of the business.

So I think it's just continuing to try to deepen as much as we can in current markets while also addressing some 5 to 10 states that are still opportunities today where we're not yet.

Okay. And the IRA is expected to have some impact on the business. What are you seeing there? And what's the latest in that?

Sure. Jen, do you want to hit IRA?

Sure. So from an IRA perspective, as we've talked about many times, we are working on a regulatory fix with Congress. So there was bills introduced in the House probably about 1.5 months to 2 months ago. There was a bill introduced into the Senate last week, both with an enhanced dispensing fee that would cover the impact for the long-term care pharmacies. We're not sure whether or not that will ultimately get passed in 2025. We've also been working and new information, I guess, probably in the last quarter has been that CMS has encouraged or directed the payers to work with the pharmacies, the long-term care pharmacies on an enhanced dispensing fee.

We've been working through that process with our payers. Other members in the long-term care pharmacy community are also doing that. Separately, we -- so we're working to mitigate or at least partially mitigate through what would be PBM rates. And then as we have mentioned, the home and community pharmacy, we have a new team in place that has many different operational initiatives that we have been working on. And we are working through a lot of efficiencies that would otherwise be growth, but that we believe would more than offset the impact for any IRA if we were to have any.

Okay. And I think in terms of cost efficiencies, you guys have -- and you talked about investments earlier, talked about $30 million to $40 million. And is that an annual -- I think that's an annual thing you're talking about.

Yes. We've been really proud of the ability to continue to try to run the organization as efficiently as you can. You just have to do that. And it's been going on 10 years of having a PMO in place that has really driven, I mean, hundreds of Lean Sigma automation, RPA projects across the organization.

This year was probably our biggest year of driving cost out of the company by just working smarter and being more efficient. Now, A.J., a ton of that money goes back into quality infrastructure, HR, IT. And so we really do reinvest as much as we can to try to continue to have the infrastructure for future growth, but as we look at next year, the plan remains the same. And it's like flip the page, what are the next set of 40 projects. And -- we're already working on those. I mean some of the things we've driven this year will be fully annualized and realized next year. So you'll get some of that carryover. And then there will be new projects.

So we hired a Chief Technology Officer kind of in this domain of discussion topic several months ago, who's outstanding. And we're not only building out our own AI team, but we're also looking to partner with certain organizations, who can move us forward in this area more rapidly. So we feel like as a scaled organization, we should be able to do things in a more sophisticated way versus always having to buy it.

So we're very judicious with our buy versus build decisions, but like these are our processes every day across our provider and pharmacy businesses at scale that we're trying to figure out how to optimize. And so if we have some of that internal development capability to build our own product solutions, that's what we want to do. And -- but we can't do it all the time, and there's an urgency to it. So sometimes we'll partner, other times, we'll want to build it out. But we are trying to build over the next 3 to 5 years, a portfolio of our own AI solutions based on optimizing our own internal practices.

And so really optimizing those products over time. And so I would say with a lot of the lean work that we've done historically here more recently, it's how do we do that through all of the AI tools out there and trying to build and enhance the team around that specific element.

So -- and yes, we've made some great talent additions to the organization and the businesses. I'd point to Home and Community Pharmacy, as Jen just mentioned, as a group of very seasoned leaders who in their career have consistently from some of the biggest and best pharmacies out there have driven cost out and just continue to make organizations more efficient, which, again, you have to be able to do.

And our view is if we can keep scaling on the customer volume side and if you have the best practices and cost leadership, that will ultimately lead to a good place in your industry, and that's what we continue to try to do, but really excited to continue to enhance the program we've always had with more of the AI capabilities.

Okay. Maybe for a couple of minutes on the provider services side of the business. We were waiting for the home health update. Any thoughts on that? Any word?

Should be any moment. We'll see what happens there. Ultimately, we feel like it's very important to make sure there is long-term sustainability from a rate perspective in that industry, obviously. I mean it's like IRA with the LTC pharmacies. I mean that was just clearly a miss. And everybody we've talked to acknowledges it and it's, okay, well, what do we do about it because that's such a critical industry.

For home health, the ROI of home health and the value that it provides is just clearly unquestionable, right? So if you have less home health, you're going to have more hospitalizations and ER visits. So you have to figure it out. Congress, right -- CMS rightly so, is focused on any fraud perpetrators out there. And that is something that absolutely everybody should be focused on going after. And as a high-quality, highly compliant provider, we want that as well, of course. We're optimistic that at some point over the next year or 2, and there's even some bills that are churning through or I think about to maybe get to Congress for just some long-term rate sustainability. So we want to try to be, particularly with the Amedisys and LHC branch divestiture pickups that that we'll have, we want to try to be helpful in any way we possibly can to provide that sort of long-term sustainability for the industry, working with Congress and working with CMS. I mean, even some of our more recent payer contracts have had quality incentives in there and tied to them, and we welcome that and embrace that because we just continue to invest in quality.

So whatever we can do to help educate and maybe be more of an involved party in the future of this discussion to satisfy everybody is what we want to do. But we'll see where this most recent final rule lands. And for us, we haven't been huge in home health historically.

For this very reason, we've been wanting to get visibility on what happens in the industry. I think the opportunity here to be a solution and the Amedisys transaction is one that we thought was unique, and we were well positioned for -- so we stepped into that. But otherwise, wanting to make sure that the industry has what it needs to continue to provide such great services to seniors.

And when you think about the Amedisys transaction, even if we got the rate as proposed, do you think that would still be accretive to you next year?

That -- all of this was certainly in our thinking as we were having our discussions with the other party. And no matter where that lands, we had contemplated that and how we view the transaction.

And say we get clarity, whatever comes out, you feel like you got a road map for what reimbursement looks like, would we then expect you to step up the pace of home health deals at that point?

I think certainly for the next year, we'll be heads down integrating that transaction. We want to -- we're super excited to welcome all the employees, and we want to do that in the highest quality way we can. Look, I think as you look across our organization, we're something like -- how many acquisitions in the last 5 years? Was it 68 or 70?

I think it's like 73.

So we're at 73. So I think we're -- like some of them are recent. So 71 out of 73 times in the last 5 years when we've done acquisitions, the EBITDA is higher than what we bought. So I think that just speaks to the care and attention we put into transactions with our operators and with our integration management office, our IMO. So we like all of our markets. They have a huge benefit. And we have the ability to sit back and think about what makes the most sense and to really optimize. So we get a ton of proprietary deal flow, because of all of our relationships in our markets.

Most everything we do is proprietary in nature. And -- but whether it's rehab, hospice, pharmacy where scale is so critical and you can really leverage your platform and your synergies we look at everything. So I mean, if I had to handicap it right now, I would say more on the infusion, hospice, rehab side is where for the next year, probably more of our priorities will be while we just kind of digest this home health acquisition and try to make sure it's going as well as possible.

And when you think about the growth trajectory of personal care, rehab, hospice, anything to call out there?

We would hope and expect that it would be very consistent. That's been a business that's been able to achieve a mid-teens CAGR from an EBITDA perspective. Those are our goals going forward for a variety of reasons with a lot of different drivers in there. Personal care has really been the one business in our company that's had the lowest growth profile. It's just a very steady high-quality business, but a couple of percent growth. That team has done a wonderful job from an execution standpoint, but not necessarily -- I mean, there are -- if we did more private pay, there's some opportunities there, but that wouldn't be one of the higher growth parts of our company, more of a steady cash flow business that we like a lot to complement some of the areas of higher growth within the platform.

And I think just as we wind down here, operating cash flow this year should be north of $375 million. I don't see a reason why that would diminish next year. M&A at one point, you were saying $100 million a year could be order of magnitude. Is that -- I think you'll get back on track for that. I know you participated in the recent divestiture of -- or sale by KKR shares. Is that something that's going to be part of this ongoing?

Yes, those will be case-by-case decisions. I mean, I think we feel really good about where our leverage has evolved to over time. I think if we can get to that $350 million, $375 million of OCF this year, we've been talking about $300 million, but it's been a really good year from a cash perspective. Free cash flow before debt pay down should be in the $250 million to $300 million range. As we sit here today, those numbers should only increase next year. And look, I think as a proxy, we've had about 75 to 100 of M&A and very accretive tuck-in deals. I think we'll have more flexibility with that going forward. And KKR has just been a wonderful partner. They continue to be so. They're never in a rush because they continue to be enthusiastic about the company.

If situations arise in the future where we can be a helpful partner in the process, and we still feel great about the valuation, we'll take that case by case. But I think safe to say that we'd like to lean in if we could, and we're just continuing to try to maximize cash flow by being very sound on the operational side and on the working capital side, too, to give ourselves as much flexibility as we can.

Okay. Well, with that, we'll wrap this up. Appreciation to BrightSpring for participating in the conference this year. Thanks, everyone, and have a good afternoon.

Thank you, A.J.

Thank you.

Good day, and thank you for standing by. Welcome to the BrightSpring Health Services Third Quarter 2025 Earnings Conference Call. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, David Deuchler, Investor Relations. Please go ahead.

Good afternoon. Thank you for participating in today's conference call. My name is David Deuchler with Investor Relations for BrightSpring.

I'm joined on today's call by Jon Rousseau, Chief Executive Officer; and Jen Phipps, Chief Financial Officer.

Earlier today, BrightSpring released financial results for the quarter ended September 30, 2025. A copy of the press release and presentation is available on the company's Investor Relations website.

Please note that today's discussion will include certain forward-looking statements that reflect our current assumptions and expectations, including those related to our future financial performance and industry and market conditions. Such forward-looking statements are not guarantees of future performance. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from our expectations.

We encourage you to review the information in today's press release and presentation as well as our quarterly report on Form 10-Q that will be filed with the SEC, including the specific risk factors and uncertainties discussed in our Form 10-K and Form 10-Q. Such factors may be updated from time to time in our periodic filings with the SEC, and we do not undertake any duty to update any forward-looking statements, except as required by law.

During the call, we will use non-GAAP financial measures when talking about the company's financial performance and financial condition. You can find additional information on these non-GAAP measures and reconciliations of our non-GAAP financial measures to their most directly comparable GAAP financial measures to the extent available without unreasonable effort in today's earnings press release and presentation, which again are available on our Investor Relations website.

This webcast is being recorded and will be available for replay on our Investor Relations website.

And with that, I will turn the call over to Jon Rousseau, Chief Executive Officer.

Good afternoon, everyone, and thank you for joining BrightSpring's Third Quarter 2025 Earnings Call. First off, I would like to thank all of our BrightSpring employees in the field and in administrative support roles who make a real impact for patients and people every day. I'm grateful for their continued dedication and commitment to providing the high quality and compassionate care and services to the individuals we serve.

BrightSpring is a leading health services provider in home and community settings, in large and growing pharmacy and provider markets. And we believe a scaled platform in home and community health care differentiates and positions us well for the future.

Today, we reported third quarter financial results that are in line with the preliminary financial results we announced on October 20. The third quarter exceeded our expectations and our ongoing commitment to high value and high quality services, operational execution and continuous improvement, all hallmarks of our company culture, have driven the financial results so far this year.

Before discussing BrightSpring's third quarter performance, I would like to remind you that the company's financial results and 2025 guidance pertain to the continuing operations and do not include results from the Community Living business.

At this time, we now expect the Community Living divestiture transaction to close in the first quarter of 2026, which remains subject to final federal regulatory approvals and typical closing conditions.

For the third quarter, BrightSpring's revenue grew approximately 28% and adjusted EBITDA grew approximately 37% versus last year's comparable quarter. Total company revenue was $3.3 billion, with Pharmacy Solutions revenue of $3.0 billion increasing 31% year-over-year and provider services revenue of $367 million, increasing 9% year-over-year.

Total company adjusted EBITDA of $160 million in the quarter grew 37% compared to the same period last year, driven by strength across the businesses. EBITDA margin for the company was 4.8%, which grew approximately 30 basis points compared to the third quarter of last year and up 30 basis points versus second quarter.

Margin expansion was primarily driven by disciplined operating expense management and modest revenue mix shift within pharmacy with greater contribution from generics.

On cash flow. The company realized over $100 million of cash flow from operations in the third quarter and leverage declined to 3.3x at the end of the quarter sooner than previously communicated expectations with an updated goal of 3x by year-end as is and below 3x pro forma for both the Amedisys and LHC home health branch acquisitions and the Community Living sale.

The company continues to deliver growth, reflective of each business line executing on our internal goals. Given the third quarter update today and current expectations for the fourth quarter of 2025, we are increasing total revenue and adjusted EBITDA guidance for 2025.

A week ago in the October 20 release, we increased our adjusted EBITDA guidance to a range of $605 million to $615 million, which compares to $590 million to $605 million communicated in August, following our second quarter results. As a reminder, this 2025 guidance excludes Community Living and any M&A activity not yet closed.

We continue to expect the Amedisys and LHC branches to close later this quarter and expect this to be immaterial to our 2025 results. We look forward to having the Amedisys and LHC colleagues joined BrightSpring and Jen will discuss Bright Spring's third quarter financial results and 2025 outlook in more detail shortly.

At BrightSpring, we're focused on quality and continuous improvement in our people and services to deliver comparatively low cost, timely and intentive patient-centric care to complex populations. Quality and patient satisfaction scores across our service lines in the third quarter remained at very high levels.

In Home Health, 94% of our branches are at 4 stars or greater with timely initiation of care at an industry-leading level of 99%. In Hospice, we continue to be a top 5% ranked hospice program in the U.S. with a caps overall hospice rating of 89%, up from 85% in the second quarter.

Overall, hospice quality index scores and the number of visits we provide patients per month on average remain well above national average.

In Rehab, our patient satisfaction scores remain exceptionally high. And in Personal Care, we have strong internal client records and quality indicator audit scores along with a satisfaction score of 4.54 out of 5. In Infusion, our patient satisfaction score was approximately 95%, and our discharge rate due to completion of therapy was stable at 96%.

Home and Community Pharmacy demonstrated 99.5% order completeness and on-time delivery of 97.2%. In Specialty Pharmacy, our medication possession ratio remains much higher than the national average at approximately 95%, and we have a time to first fill of 3.7 days. Our company continues to demonstrate high levels of execution and customer satisfaction across service lines.

Turning to the company's financial results by segment. Total Pharmacy Solutions revenue grew 31% in the third quarter and adjusted EBITDA grew 42% versus the prior year with Total Pharmacy census growth facilitating Total Pharmacy script volume of 10.8 million in the quarter. Though script volumes demonstrated strong growth in both Specialty and Infusion with over 30% script growth in the subsegment, Total Pharmacy volumes declined 1% versus the prior year due to the majority of scripts being in Home and Community Pharmacy and a decline in the Home and Community Pharmacy Total scripts dispensed due to divestitures associated with the customer that previously declared bankruptcy as well as flu season beginning later in 2025 as compared to 2024, operational decisions made to exit specific uneconomic customers and a difficult comparison to last year when we added the same aforementioned customer in the third quarter.

In the Specialty and Infusion business, revenue grew 42% year-over-year, which exceeded expectations. The performance in Specialty and Infusion was driven by limited distribution drug launches, generic drug utilization from conversions over the past year, strong commercial execution from the team and excellent patient service.

Specialty Scripts grew approximately 40% in the third quarter, driven by strength in both brand LDDs and generics. We ended Q3 with 144 LDDs including 5 LDD launches in the quarter. Through the end of October, our LDD portfolio has now expanded to 145 therapies and we continue to expect 16 to 18 additional LDD launches over the next 12 to 18 months.

We are honored and proud to have been chosen as a preferred specialty pharmacy partner for these new therapies that are being utilized to treat a range of cancers and rare and orphan diseases. We work diligently to deliver high-quality care to patients and gain the trust of manufacturers prescribing physicians and patients to support long-term therapy innovation and growth.

Within Infusion, performance in the quarter was in line with expectations, driven by solid double-digit volume growth and continued benefit from operational improvements and procurement initiatives to streamline the business and improve profitability with strong year-over-year EBITDA growth well into the double digits.

Our strategy is a broad-based one in terms of both acute and chronic therapies. We remain excited about the acute market where we believe there exists a multibillion-dollar market where our leadership team can leverage best practices and scale the business in new geographic markets efficiently.

We also remain constructive on our ability to expand chronic infused therapy offerings, as we look to innovate delivery to patients living with chronic disease.

In Home and Community Pharmacy, revenue performance in the quarter was in line with our expectations, and we continue to optimize the go-to-market strategy and customer mix to ensure profitable growth in attractive and targeted end markets. Under a new and expanded leadership team, we continue to implement operational initiatives to augment efficiency with year-over-year EBITDA up outside of several unusual items in the quarter. Over time, we expect to continue to expand our presence in target markets with industry-leading operational processes, quality and efficiency.

Turning to the provider segment. We are pleased by the performance across each of our service lines in the third quarter. Provider revenue grew 9% year-over-year, and segment adjusted EBITDA grew 16% with a segment adjusted EBITDA margin in the quarter of 16.5%, up approximately 90 basis points year-over-year.

Home Health Care, which represents about 50% of the revenue in Provider segments and is comprised of home health, hospice and primary care, grew 12% year-over-year. The Home Health Care business continues to perform very well, driven by strong quality metrics and patient satisfaction scores, ongoing operational investments and advancements, de novo expansion and preferred provider of Medicare Advantage contracts are continuing to advance.

Average daily census and Home Health Care was 29,592 in the third quarter, representing a 3% increase year-over-year, with hospice increased approximately 15% year-over-year in the quarter. In the third quarter, Home Health settings at 5 states were awarded accreditation by the Accreditation Commission for Healthcare, or ACHC, reflecting compliance with ACHC standards and CMS' conditions of participation, highlighting our commitment to providing safe and high-quality care to patients.

Home-Based Primary Care also delivered solid growth in the quarter. We believe primary care and home remains a large opportunity, as we continue to build out the business, particularly as it relates to the benefits of our integrated services and ACO and payment models, which we continue to make steady progress on.

Moving to Rehab Care, which represented approximately 20% of provider revenue in the third quarter, growth was 9% year-over-year, underpinned by 11% growth in person served and approximately 17% growth in hours billed in the core neuro rehab services. We have continued to see a long history of performance and positive momentum in the rehab business and the expansion of our rehab into ALS and home settings with Part B rehab for seniors is now ongoing, as we went live in the quarter with a key milestone and integrated home health and rehab offering in ALS.

In Personal Care, which represented approximately 30% of provider revenue in the third quarter, revenue grew 6%. Personal Care growth operations and performance remained very steady, including solid growth in persons served. Overall, we continue to realize and see many benefits from our high-value services in targeted markets with 1 integrated and coordinated enterprise.

Finally, we are excited to announce that we will be hosting an Investor Day on March 17 in Louisville. We look forward to the opportunity to review our company's strategy with the investment community, discuss each of our service lines and outline the prospects for each in the years to come.

To close, we are pleased with BrightSpring's operating performance and financial results in the third quarter and the progress we have made so far in 2025, and we look forward to entering 2026 from a position of strength with continuing investments for long-term differentiation and sustainable growth across the organization.

With that, I'll turn the call over to Jen.

Thank you, Jon. Before I discuss our financial results for the third quarter of 2025, I'd like to remind you that in the first quarter of this year, we began to record the Community Living business in discontinued operations, as indicated in the press release and 10-Q, to adhere to accounting standards required on an interim basis.

As such, all BrightSpring financial results and forecasts that I will discuss are related to continuing operations and exclude Community Living. Management believes the presentation of the non-GAAP financials from continuing operations is a useful reflection of our current business performance.

In the third quarter of 2025, total company revenue was $3.3 billion, representing 28% growth from the prior year period. Pharmacy Solutions segment revenue in the quarter was $3.0 billion, achieving 31% year-over-year growth. Within the Pharmacy segment, Infusion and Specialty revenue was $2.4 billion representing growth of 42% from prior year and Home and Community Pharmacy revenue was $590 million, which was approximately flat year-over-year.

In the Provider Services segment, we reported revenue of $367 million in the third quarter, which represented 9% growth compared to the prior year. Within the Provider Services segment, Home Healthcare reported $188 million in revenue, growing 12% versus last year. Rehab revenue was $76 million, growing 9% versus last year; and Personal Care revenue was $102 million, representing growth of 6% year-over-year.

Moving down the P&L. Third quarter company gross profit was $392 million, representing growth of 21% compared with the third quarter of last year. Adjusted EBITDA for the total company was $160 million in the third quarter, an increase of 37% compared to the third quarter of 2024. Adjusted EPS for the total company was $0.30 for the third quarter.

In the third quarter, continuous lean, automation and efficiency programs at the company contributed to growth and margin improvement, and we anticipate additional improvements in the fourth quarter from ongoing operational initiatives. Further, we have seen a positive impact in the third quarter and into Q4 from our targeted growth investments including in recent home health volume, hospice volume, rehab volume and an accelerating infusion volume and growth in LDD and generics in the specialty oncology and rare and orphan therapy business.

Turning back to segment performance in the third quarter. Pharmacy Solutions gross profit was $246 million, growing 30% compared with the third quarter of last year. Adjusted EBITDA for Pharmacy Solutions was $141 million for the third quarter, an increase of 42% compared to last year representing an adjusted EBITDA margin of 4.8%, which was up approximately 40 basis points versus last year.

Provider Services gross profit was $146 million, growing 9% versus the third quarter of last year. Adjusted EBITDA for Provider Services was $61 million for the third quarter, growing 16% versus last year, representing an adjusted EBITDA margin of 16.5%, up approximately 90 basis points versus last year.

Not included in the company's reported adjusted EBITDA of $160 million, as previously stated, Community Living's adjusted EBITDA was an additional $40 million in the quarter, an increase of 18% from the prior year in this business.

On a total company basis, cash flow from operations was $108 million in the third quarter. We continue to expect to deliver over $300 million of annual run rate operating cash flow in 2025, and we remain focused on improving our leverage ratio towards our year-end goal of below 3.0x pro forma for both the pending Home Health acquisition and the Community Living divestiture.

Our adjusted EBITDA growth, combined with our cash flow generation during the quarter, has led to a leverage ratio at September 30 of 3.3x. Longer term, with continued growth, execution and cash flow generation, we remain on track towards a leverage target of 2.5x which at current trends could be realized by mid or later next year, excluding acquisitions or other uses of cash.

As of September 30, net debt outstanding was approximately $2.5 billion. As mentioned previously in January, we expect to receive approximately $715 million of net cash proceeds from the $835 million of gross cash consideration in the pending Community Living sales. As a reminder, net interest expense includes interest income related to cash flow hedges due to our 3 received variable, pay fixed interest rate swap agreements that we have in place, which matured on September 30, 2025.

As part of our process to monitor and address risks, during the quarter, we entered into two 3-year interest rate hedges, which are additional to the 1-year extension that was entered into during the first quarter, providing stability to our interest rate risk through September 2028.

Prior to any proceeds from the pending Community Living divestiture, quarterly interest expense is still expected to be approximately $43 million, including approximately $1.2 million of interest expense related to the TEU instrument.

Turning to guidance for 2025, which excludes the Community Living business as well as any acquisitions that have not yet closed. Total revenue is expected to be in the range of $12.5 billion to $12.8 billion, including Pharmacy Solutions revenue of $11.05 billion to $11.3 billion and Provider Services revenue of $1.45 billion to $1.5 billion.

This revenue range reflects 24.1% to 27.1% growth over full year 2024, excluding Community Living in both years. Total adjusted EBITDA is expected to be in the range of $605 million to $615 million for full year 2025. This would reflect 31.5% to 33.7% growth over full year 2024, excluding Community Living in both years.

I will now turn it back to Jon.

Thanks, Jen. Thank you for your time today to go through BrightSpring's third quarter 2025 results. We will now open up the call for questions. Operator?

[Operator Instructions] And our first question comes from A.J. Rice of UBS.

Just one question and a follow-up maybe. On the discussion about the pacing of new drug launches, I know for some time, you talked about 16 to 18 launches over an 18-month period. Earlier this year, you sort of said that, that pacing you've seen that go in a year. I know today, you made the comment that looking ahead, you still see that 16 to 18 over the next 12 to 18 months.

I guess I'm just trying to understand, is the pacing of new drug launches that are relevant to you accelerating? Is it about what it's always been? And is the -- if it's accelerated, is the pipeline still pretty robust?

Thanks for the question. I think the pipeline remains unchanged, just given the magnitude of it both in the next year and over the next 5 to 7 years on the brand side. We have had probably one of our strongest years in terms of brand wins going back several years. It's been robust, but this year has been a very good year. So we've seen some therapies come to market sooner, and we've been in a good position to be a partner on most all of those therapies.

So it has been a good year, a little bit ahead of expectations, but we still expect a similar number of the 15 to 18 over the next year, 1.5 years. Nothing's really been pulled forward that would affect the future. Some things happen a little bit sooner, but the pipeline remains robust, as we go bottoms up drug by drug. We still feel confident in that pace going forward.

Okay. And then the follow-up question I was going to ask is, in your prepared comments about the pending transaction, I know you mentioned Amedisys and LHC branch acquisitions. How -- it sounds like maybe what you're buying has changed a bit. Can you give us any specifics on is it significantly bigger than what you were originally looking at or any other ways in which you ultimately ending up buying has changed?

Yes. There's always been some of the divested branches for LHC, but it's been the minority. So I think we just more or less said Amedisys in the past. It is a significant majority of those branches. As United was working through all of its final agreements with the FTC, the universe did increase a little bit, not dramatically at all, but a little bit.

So there's been a handful more branches that have that have been included in the group in the past couple of months, and we do expect that transaction to close in the quarter.

Do you have any early read on whether it will be accretive to '26? I know you said it would be neutral this year. Is it meaning any significant accretion next year or is it neutral or how should we think about it?

I think accretion is a fair comment, yes.

And our next question comes from David Larsen of BTIG.

Congratulations on a great quarter. Can you talk about the sources of accretion for like the Amedisys transaction or, quite frankly, any transaction, where do you drive the incremental margin and profit from, please?

We're limited -- trying to make sure I understand the question. We're limited on what we're able to disclose about this transaction still to do some of our agreements with the other party. I think it's fair to say that we would look to integrate the operations as seamlessly as we can. We've had a really good partner which has enabled us to dialogue with the other side to make sure we do this as well as we possibly can.

We're very excited about it, and we're optimistic about applying some of our practices, some of our payer contracts, some of our IT and technology and people practices to the organization. But look, it's well run, always has been well run. That's one of the things that we were very enthused about, and we look forward to keeping up that consistency.

And if there's any synergies that are really beneficial really more from a growth and efficiency perspective because we'll retain all the employees for sure. But if there's any other synergies in the technology area or other areas similar to those that were able to drive on other acquisitions, we're certainly going to be planning and looking to do those.

Okay. That's very helpful. And then I think I'm calculating an EBITDA per script increase of 32% year-over-year. Is that correct? That sounds high, which is good, obviously. Just any color around sort of the sustainability of that growth rate? And what some of the key drivers there would be?

Yes. So I think directionally, that is accurate. It's really probably just a little bit higher on a per script adjusted EBITDA basis from a pharmacy perspective. The sources of those changes are really mixed. We've had higher growth in specialty and specialty scripts, which -- those are our highest gross profit and adjusted EBITDA scripts that we have. And so we -- as Jon mentioned in his prepared remarks, we had over 40% growth in specialty scripts during the quarter, and so you see a mix impact associated with that.

Great. And one more quick one. Can you just remind me as a drug launches biosimilar or goes generic, how much of an earnings lift is there typically in terms of margin per drug?

David, that's not really information that we really reference. But when a drug goes generic, I think it's common knowledge that there are more manufacturers and that reduces the procurement cost. And overall, the price of the drug comes down pretty dramatically. But net-net, that's a very positive thing for all stakeholders and everybody in the industry, but really as a function of a lot more manufacturers typically able to provide the drug, you see a dynamic there, which is favorable to all stakeholders.

And our next question comes from Charles Rhyee of TD Cowen.

Jon and Jen, just wanted to ask, obviously, in one of the big competitors in Community and Pharmacy would be Omnicare and they declare bankruptcy. Just curious to what you think of that as an opportunity to pick up incremental share? What kind of overlap in the markets? Are you there? Is that an opportunity to enter into new markets? Or is skilled nursing really maybe not that attractive to keep expanding into first?

I don't know that we have any view that that's going to be material. As we understand it, it was really related to some litigation going away back less to do with operational performance. But we're just very focused on our customers and our end markets including some that we think are really interesting, like assisted living, behavioral, hospice, et cetera.

And that is where the majority -- the vast majority of our Home and Community Pharmacy EBITDA comes from. I will take a second to talk a little bit further about the script growth in the quarter on the hospice, on the infusion, on the specialty pharmacy sides, all really, really strong growth, well, well, well into the double digits.

On the SNF side, just a few dynamics that will probably be dynamics for the next couple of quarters, but doesn't impact anything from an EBITDA standpoint. We signed a large customer last Q3, which at the time was a really great event. That's the customer that has subsequently declared bankruptcy.

And we've been unwinding some of those buildings. We've also taken the opportunity with the new leadership team to heavily scrutinize the customer base and make some decisions proactively about what we want to do there to make sure we don't ever encounter sort of any payment issues or unprofitable customers.

And so we've been very proactive about that. It's been very constructive. The flu season also started later this year. And so you have basically a huge customer that was coming online last Q3, that is going offline. And from an EBITDA perspective, the business is doing extremely well.

Just given growth in the other markets and our focus on a lot of operational efficiencies. And so -- but that's a dynamic that you'll see for the next quarter or 2, as we work through just the timing element around around that, really that 1 customer.

I think importantly, we are growing and doing extremely well in the areas that matter, that drive EBITDA. And we're extremely excited about Home and Community Pharmacy's prospects over the long term. Their EBITDA was up this quarter. I couldn't be more enthusiastic about a lot of the operational automation, AI efficiency projects in there with the new team and super excited about the business, but that is the dynamic when you look at last Q3 versus this Q3.

And since Home and Community scripts are 77% of the Pharmacy scripts, that's the net number for the year-over-year. But in some of our key service lines, exceptional performance. And again, where we're looking to drive the most growth with Home and Community being a play around targeted end markets and continued operational and automation improvement there.

That's helpful. Just one follow-up on LDDs. Obviously, the FDA, I think there have been some concerns about the pace of drug approvals. I know that there were relatively fewer drug approvals in the first half of this year. Just curious what you're seeing, if you're starting to see that pick up, if that causes any concerns for you in terms of sort of the LDDs you have on deck in terms of timing?

We haven't seen any impact. Our performance on the LDD side has really kind of been a record year and the pipeline is as big as ever.

And our next question comes from Pito Chickering of Deutsche Bank.

This is Kieran Ryan on for Pito. Apologies if I missed something on this, but I was wondering if you could kind of provide a little more color on the breakout of the pharmacy guidance between Spec and Infusion and Home and Community, but with a focus on kind of what it implies to Spec and Infusion? I just wanted to see if maybe a little bit of the potential slowdown there in 4Q, if that was kind of related to your comments on it's been -- how it's been kind of a record year on the branded side, and maybe that's normalizing a little bit.

So what we would say is that we don't really see a slowdown. We did update our revenue guidance. And when you look at that, I think you'll still see strong growth year-over-year and we do expect that in Q4. From a pharmacy perspective, from a revenue standpoint, we did have obviously increased revenue guidance, that largely relates to the Specialty and Infusion business, as it relates to the continued strong growth from a scripts perspective that we continue to see in that business.

I would also add though that from a margin perspective or an EBITDA perspective, we do have -- we have increased our guidance to include additional efficiencies in the projects that we had talked about earlier and throughout our scripts, the operational projects that are going on, both in Infusion and Home and Community Pharmacy, and we do expect those to accelerate in Q4 as well.

Got it. That's helpful. And then if you could just provide maybe a quick update on what you're seeing within M&A pipeline and kind of your priorities there? I know it's mostly focused on the tuck-in style deals, but just a quick refresh there would be helpful.

Yes, that's right. Nothing imminent outside of that, other than obviously the Amedisys LHC transaction. So as we've been working through the community living divestiture and then the Amedisys LHC branch acquisition. We have just been focused on really small deals and target attractive geographies that are highly accretive. And that will probably continue at least for another quarter.

So there's nothing imminent in terms of anything sizable, but our M&A strategy will remain primarily focused on accretive tuck-ins and target geographies and probably a little bit more activity in deals of a little bit higher size, call it in the $3 million to $10 million of EBITDA range, those might start to get more focused again as we get past these 2 transactions into next year.

We remain open and flexible to something interesting, a little bit larger, but certainly nothing transformational that's on our radar screen whatsoever right now. We really like our current strategy and where our organic growth is and where the balance sheet is.

And our next question comes from Brian Tanquilut of Jefferies.

Congrats on the quarter. Jon, maybe as I think about generics really quickly since you touched on that in your prepared remarks. Anything you can share with us in terms of the cadence of upcoming patent expirations in your portfolio and also the dynamics in terms of the margin ramp? Like what is the runway for margin ramping on a per script basis for a new generic launch?

Yes. I think some of the information brand we've laid out publicly remains the same. We expect numerous more brand to generic conversions over the next couple of years including a more significant one probably at the end of Q1 next year and we expect similar overall dynamics in these conversions that we've seen and experienced in the past and over the past 10 years.

So our ability to partner with manufacturers and win innovative new brand therapies, the very strong growth in our fee-for-service business in that business and then the steady stream of these branches to generics, really all underpinned by our service levels and commercial team and efforts, I think really remains very consistent as we look out still over the next 5 years. So I think the information that we've put out there publicly and in our slide deck remains our current view.

Got it. And then, Jon, just on the delay on the Community Living divestiture. Anything you can share in terms of what that is or what caused that and just anything we should be on the lookout for to get that closed?

Yes. No, nothing unusual. Unfortunately, these processes could just take time these days. The recent government shutdown wasn't overly helpful. But we remain very optimistic that this will close in Q1. There were a handful of markets that the buyer needed to work through with the FTC, which is ongoing and seems very straightforward and is well down the path. So we expect that to occur in Q1.

And our next question comes from Ann Hynes of Mizuho.

Great. Just anything on the Washington front that we should be on the lookout in the next coming months, especially with the potential health care bill going through Congress at the end of December?

Yes. There's nothing too noteworthy from our perspective on that front. It's been pretty consistent over the last few months on the home health rule that's supposed to come out any day, it could be delayed a little bit due to the government shutdown. While any potential -- if you look at what's historically happened and some strong industry advocacy, we expect to see some mitigation of the proposed cut in the final rule.

While any cut is not a meaningful impact on us today, just given the percent of revenue and EBITDA that, that business is, we'll navigate any rate changes pretty readily. And ultimately, these critical services need to be appropriately funded going forward. So we'll continue to be very vocal about that, trying to educate where we can, and we look forward to partnering with CMS as best possible on some aligned solutions there.

On the IRA front, we're very pleased that CMS and a letter to the payers in the quarter directing them to account for the IRA and their 2026 pricing. And we're also pleased to our advocacy on the with the administration that we have a lot of champions who understand the unique impacts on LTC pharmacies from IRA.

There's a bill in the house. There's one hitting the Senate tune. But that said, there's a lot going on in D.C. up until the end of the year. And regardless of what happens, we feel like our internal mitigation plans along with the strength of the breadth of the enterprise put us in a really good situation. And so really no material updates in how we framed that before.

And our next question comes from Matthew Gillmor of KeyBanc.

I wanted to drill down on the EBITDA guidance raise. You raised the outlook a bit more than the beat on the quarter. From Jennifer's comments, it sounds like that reflects the combination of core performance and then pulling through some efficiency efforts. Was that about the components of the change?

That is correct, yes.

Okay. And then as a quick follow-up, I think in the past, you've talked about being conservative with the value-based care accruals, but you have some potential shared savings to go get. I just wanted to see if there's been any change in thinking there and if there's still some potential to pull through some shared savings at some point later in the year?

Yes. I think at this point, we've gained clarity that we will get some shared savings there. But that after receiving news about last year, here, just very recently, looks to be probably a little bit of opportunity there that will be realized.

And our next question comes from Joanna Gajuk of Bank of America.

So I guess, a couple of follow-ups. So first, I appreciate the comments around the acquisition of the assets from Amedisys and LHC will be accretive next year. But anything else we should be thinking about heading into next year in terms of any high-level tailwinds and headwinds?

Look, I mean, I think there's been just real consistency throughout the year certainly, as we sit here today, we expect that to continue really something we've seen all year long, every quarter, each service line is performing really well. individually. And I would say here, more recently, a lot of our efforts, as we've talked about in infusion in the past 18 months-or-so, are bearing fruit.

Extremely excited about that being a real tailwind for next year. Hospice continues to perform extremely well. That rate increase will go into effect in Q4. And obviously, some of the momentum around the LDDs and the conversions on the specialty side, home health with the acquisition of the divested branches.

A lot of great things going on there in the business, too, including automation initiatives, hiring a new sales team. We had the best admissions month ever in September in Home Health and that's where we have a new sales leadership team in place. We're tracking right now to have our biggest customer win quarter ever in Home and Community Pharmacy. We're excited about that.

And as Jen mentioned, we are really investing heavily. We've always had a focus on lean, continuous improvement and efficiency. We're just continuing to invest there. We maybe mentioned last quarter, I can't remember, we have a new CTO, and we're building out an internal AI team that is well underway.

We've got all of our projects identified. We're also working with outside vendors on AI implementation. And so look, from a growth and from an efficiency standpoint, we just continue to push as hard as we can and a lot of positives there. I would also note just the balance sheet and where that's gotten to here, even a quarter ago, we were sitting at about 3.64x leverage.

Now we're at 3.31x, that's a pretty good decline in a quarter. I think a quarter ago, we were talking more about 3.5x year-end leverage, now our view is 3x, 3.0x year-end. We were talking about getting down to 3.0x after the Community Living sale, now we think that puts us well below 3x when the Community Living transaction closes, even net of the Amedisys and LHC acquisition.

So we just feel really good and are enthusiastic about our progress on the balance sheet and being at or quite a bit below 3x leverage at the end of the year on the other side of that Community Living divestiture. We also have been talking about 300 of OCF this year, that number is probably more like 375, maybe a little bit more, probably 260, 270 of free cash flow before debt and more.

So a lot of focus in the organization too on the balance sheet around cash flow and that's been really positive.

And if I had a couple of follow-ups. So on this comment about infusion right you -- so I'm very excited about this, and I guess you've been growing it nicely. But as we think about the Pharmacy segment, I guess, in totality or maybe the Specialty Infusion, but the Pharmacy segment, right, the revenue is going to grow more than 25% this year, right? So how should we think about your ability to kind of grow on top of this growing into next year?

So from an Infusion standpoint, obviously, as they're growing faster than they are today, we would -- so Specialty, we don't see any changes. As it stands today, we don't see significant changes to their pace of growth. We do see Infusion accelerating. So we think that provides a little bit of a tailwind for us into next year.

And our next question comes from Erin Wright of Morgan Stanley.

A couple of questions. First one is kind of bigger picture. Just -- can you speak to kind of some of the future opportunities across kind of Pharmacy solutions and specifically kind of Specialty Pharmacy. The focus has been on oncology, but can you speak to rare disease or other areas and also the opportunity around some of those value-added manufactured biopharma services and the respective margins associated with some of those opportunities evolving over time?