What Cardinal Health, Inc. told the SEC could break it.

Cardinal Health remains subject to the National Opioid Settlement Agreement (NOSA) and other opioid-related matters, a material multi-year liability for pharmaceutical distributors.

“See Note 8 of the "Notes to Consolidated Financial Statements" for more information about the NOSA and other opioid-related matters.”

Cardinal Health had $56 million accrued at June 30, 2025 for losses and legal defense costs related to IVC filter product liability lawsuits, including $49M in a qualified settlement fund.

“At June 30, 2025, we have a total of $ 56 million accrued for losses and legal defense costs, related to the IVC filter product liability lawsuits in our consolidated balance sheets, which includes the $ 49 million in the qualified settlement fund.”

Beyond CVS (30%), Cardinal Health's sales/credit concentration is significant: its five largest customers account for 43% of fiscal 2025 revenue, and sales to members of its two largest GPOs (Vizient and Premier) collectively account for 27%.

“In the aggregate, our five largest customers, including CVS Health, accounted for 43 percent of our fiscal 2025 revenue. We have agreements with group purchasing organizations (“GPOs”) that act as agents to negotiate vendor contracts on behalf of their members. Our two largest GPO relationships in terms of revenue are with Vizient, Inc. and Premier, Inc. Sales to members of these two GPOs, under numerous contracts across our businesses, collectively accounted for 27 percent of our revenue in fiscal 2025.”

Cardinal Health is directly exposed to price changes in oil-based resins, nitrile, cotton, diesel fuel, and latex used in medical products, with ~$491M of forecasted direct commodity exposure for fiscal 2026.

“We are directly exposed to market price changes for certain commodities, including oil-based resins, nitrile, cotton, diesel fuel, and latex. We typically purchase raw materials at either market prices or prices tied to a commodity index and some finished goods at prices based in part on a commodity price index.”

Following a Dec 2023 inspection, the FDA issued an April 2024 warning letter over plastic syringes sourced from a third-party China manufacturer lacking appropriate 510(k) clearance; Cardinal took action and continues to cooperate.

“For example, following a facility inspection in December 2023, the FDA issued a warning letter to Cardinal Health in April 2024 related to plastic syringes sourced from a third party manufacturer in China asserting these products did not have appropriate 510(k) clearance and restating some of the observations from the December 2023 inspection.”

For reasons of quality assurance, cost effectiveness, or availability, Cardinal Health procures certain components and raw materials from a sole supplier, exposing it to interruption if those relationships are disrupted.

“In some instances, for reasons of quality assurance, cost effectiveness, or availability, we procure certain components and raw materials from a sole supplier. Our supplier relationships could be interrupted, become less favorable to us or be terminated and the supply of these components, compounds, raw materials, or products could be interrupted or become insufficient.”