Good day, ladies and gentlemen. Welcome to the McKesson Fourth Quarter Earnings Call. Today’s conference is being recorded. At this time, I would like to turn the conference over to Craig Mercer. Please go ahead sir.

Thank you, Nicole. Good morning and welcome to the McKesson’s fiscal 2018 fourth quarter earnings call. I am joined today by John Hammergren, McKesson’s Chairman and CEO and Britt Vitalone, McKesson’s Executive Vice President and Chief Financial Officer. John will first provide a business update and then Britt will review the financial results for the quarter and full year. After Britt’s comments, we will open the call for your questions. We plan to end the call promptly after one hour at 9:00 a.m. Eastern Time. Before we begin, I will remind the listeners that during the course of this call we will make forward-looking statements within the meaning of the federal securities laws. These forward-looking statements involve risks and uncertainties regarding the operations and future results of McKesson. In addition to the company’s periodic, current and annual reports filed with the Securities and Exchange Commission, please refer to the forward-looking statements slides and text of our press release for a discussion of the risks associated with such forward-looking statements. Please note that on today’s call, we will refer to certain non-GAAP financial measures. In particular, John and Britt will reference adjusted earnings, adjusted operating profit margin excluding non-controlling interests, free cash flow and items excluding foreign currency exchange effects. Please note, McKesson will no longer provide forward-looking GAAP earnings per diluted share guidance. The company is unable to provide this information without unreasonable efforts given the inherently uncertain factors impacting forward-looking GAAP results. Many of which are beyond the company’s control, such as LIFO inventory related adjustments, gains from antitrust litigations and certain impacts from federal tax reform. We filed the second 8-K with the SEC today, which includes supplemental historical statement financial information for fiscal 2016, 2017 and 2018 results as well as quarterly information for fiscal 2018. This will allow you to compare our fiscal 2019 outlook to our historical results on the same segment basis. Finally, I would call to your attention the supplemental slide presentation that we will reference on today’s call which maybe found on the Investors page of our website at mckesson.com. We believe the earnings press release, supplemental slides and the supplemental historical segment information 8-K filing, which I will include non-GAAP measures will provide useful information for investors with regard to the company’s underlying operating performance and comparability of financial results period-over-period. Please refer to these materials which maybe found in the Investors section of our company website for further information and a reconciliation of the non-GAAP performance measures to the GAAP financial results. Thank you. And here is John Hammergren.

Thanks, Craig and thanks everyone for joining us on our call. I am pleased to report our fourth quarter adjusted earnings of $12.62 representing a 1% growth year-over-year. These results were consistent with what we communicated a month ago which included a lower tax rate, stronger operational performance, and our $100 million contribution to create the new nonprofit foundation. And our fiscal 2019 outlook for adjusted earnings of $13 to $13.80 per diluted share represents low to high single-digit percentage growth year-over-year. This outlook reflects a competitive, but more stable market environment and effective capital allocation, while including the anticipated headwinds in our European and Canadian businesses. I would also remind you that our multiyear strategic growth initiative is not expected to materially impact our financial results in the coming year. We are in the preliminary phase of implementing the strategic growth initiatives and efforts are well underway across the organization. We will provide more details on our progress as well as our growth initiatives at our Investor Day, which is scheduled for the end of June. Turning back to our operating performance, I am pleased with our fourth quarter results, which were driven by solid execution across multiple businesses. And for the year, we were able to deliver results that were largely in line with our expectations outlined at the beginning of the year. Britt will cover our annual financial performance in greater detail, but let me provide some color on the year just concluded. During fiscal ‘18, we demonstrated our sourcing expertise and shared significant benefits with our partner, Walmart. We are excited about what we are able to deliver as well as the potential for expanded opportunities through this partnership. We bring new value to health systems customer relationships and renewed our extended contracts with all of…

Thank you, John and good morning. Today, I will review our fiscal 2018 results, discuss our new segment reporting structure, provide a brief update on our multiyear strategic growth initiatives and provide details around our fiscal 2019 adjusted EPS guidance range of $13 to $13.80 per diluted share. As a reminder, we provide guidance on an annual basis due to both the seasonality in quarterly fluctuations inherent in some of our businesses. In this context, an annual view of our financial results can be more meaningful and provide more insight into key trends. Therefore, my comments today will focus primarily on annual results. Let me begin with a review of our results for fiscal 2018. Today, we reported fiscal 2018 adjusted EPS of $12.62 reflecting a lower tax rate and share count as well as solid operating results partially offset by the fourth quarter, $0.31 per diluted share contribution to create a nonprofit foundation to combat the opioid epidemic. Turning to Slide 6 of the presentation, our fiscal 2018 adjusted earnings exclude the following GAAP-only item. Amortization of acquisition-related intangibles of $2.60 per diluted share, acquisition-related expenses and adjustments of $1.20 per diluted share, LIFO inventory related credit of $0.31 per diluted share, restructuring charges of $2.82 per diluted share, including long-lived asset impairment charges and other adjustment net charges of $6.01 per diluted share comprising the non-cash goodwill impairment charges for our European and Rexall businesses and the early repayment of long-term debt that we disclosed last month, which was partially offset by benefits related to the Tax Cuts and Jobs Act of 2017 and the sale of our Enterprise Information Solutions business in third quarter. In connection with the annual goodwill impairment testing that takes place in our fourth quarter, we recognized non-cash after-tax goodwill and long-lived asset…

Thank you so much. [Operator Instructions] And we will take our first question from Steven Valiquette with Barclays.

Hey, thanks. Good morning, John and Britt. Thanks for all the extra segment details. I guess just drilling in a little bit deeper on the U.S. pharma segment with the operating profits expected to be flat to down a little bit in fiscal ‘19 you mentioned Rite-Aid as the key factor, but I am curious just two other quick questions around that. First, are there any material customer contract renewals also baked into that assumption and also is there any quantification of the acquisition contribution into that U.S. pharma segment EBIT expectation as well? Thanks.

Thanks for the questions, Steven. This is John. Our assumption around customer contract renewals is pretty consistent with what we have experienced in the past. So as you know we typically renew our customer contracts when they come up and we do a pretty good job of making sure that value is delivered to our customers and then we continue to drive efficiency in our organization. So I think the time that we have really come up on the negative end of customer contract renewals has been related primarily to consolidations where sometimes we can’t predict which way a customer might land or certainly the acquiring company might weigh more heavily in those decisions. So I think our forecast clearly would expect us to continue to renew our contracts and they have the normal kind of cadence of those renewals. Britt, perhaps you can help with the second question?

Yes, thanks for that. As it relates to M&A and the impact that we expected to have, as you know last year, we completed a number of acquisitions and in the fourth quarter, we completed the acquisition of RxCrossroads and I would remind you that we provided you an accretion estimate by the end of year three of about $0.25, but we completed a number of acquisitions that we are excited about, we think that they are going to add to the overall excitement and RxCrossroads is a good example of that.

Sorry, it’s future acquisitions though is there any assumption for that in there or is that not in there?

No, we have outlined for you the acquisition of MSD which we announced in our April call.

Which is in the medical segment.

Okay, got it. Okay, thanks.

And we will take our next question from Lisa Gill with JPMorgan.

Thanks very much. John, I just want to go back to your comment though about renewals on existing customers, can you just remind us are contracts generally renewed exactly at the date that they expire or is the anticipation that perhaps you give up some pricing prior to that expiration date, because that’s an important relationship?

Well, that’s a good question, Lisa. I would say, our history is that we maintain these relationships for very long times. The contracts might have duration of let’s say an average 3 years, but many of their relationships go decades and our typical pattern is to renew those relationships or extend those contracts in a form that’s very similar to what it’s been in the past. So, I’d say most of them don’t renew exactly on the expiration date. They usually sort of a rolling process of renewals before they expire to the standard to move forward with the relationships. So, your point is accurate. I can’t give you specific time, but these things would renew usually in advance of their expiration date.

And so I think what we just want to understand is that, that’s included in the guidance you gave, your anticipation is that you are going to renew the relationships that you have and that there could be some element of renewed pricing in the guidance that was given today?

Absolutely. I mean, our guidance fully reflects what we anticipate will happen in fiscal ‘19 and reflects the contracts that are expiring in our anticipation of not only the renewal, but also likely financial impact of those renewals. So, that’s fully included. Now, clearly, we could be surprised and we don’t anticipate that we are going to lose our customer base and that our assumptions are built into this forecast.

And then as a follow-up to that, when we think about incremental opportunities, we should think about those renewals and I think about ClarusONE, what are some of the incremental things you can add to that platform, over-the-counter products is one thing that comes to mind for me. Is over-the-counter an opportunity, do you think of other things that you can put into your purchasing procurement as you think about those renewals with some of these larger contracts that you have?

Well, Britt helped us build ClarusONE, I will let him address ClarusONE specifically, but obviously one of the things we are trying to do also is to get more and more of our customers to buy all of their generics from us and that compliance to our generic purchasing requirements continues to expand. So that’s part of the value that we derived both for our customers and for ourselves is getting more and more people into sourcing all of their generics from McKesson. As it relates to going beyond just generic purchases, Britt, maybe you can talk about future opportunities.

Sure. Thanks for that question. With ClarusONE, we are certainly working with Walmart, but also our other customers to understand where we have opportunities to leverage our scale collectively with our customer base. OTC is certainly an opportunity for us and it’s one that we have discussed among other, many other opportunities at Walmart. So clearly looking at how we can help our customers and how we can leverage scale across ClarusONE and our customers to deliver across multiple categories is certainly something that we are talking about and considering as we move ClarusONE forward.

Okay, great. Thank you.

And we will take our next question from Glen Santangelo with Deutsche Bank.

Yes, thanks and good morning. John, it’s pretty clear that your pharmaceutical and specialty solutions business is going through a pretty significant evolution here with respect to specialty and the generic tailwinds seemingly are largely in the rearview mirror. In your prepared remarks, you talked about your differential pricing strategy for brand and specialty and generics, could you talk about maybe how some of those contract renewals have gone with respect to this new pricing strategy? Is that having a near-term dilutive impact on your margins or how should we think about that?

Well, thanks for the question. I think as we have indicated and we began this process several years ago and as our contracts have renewed we have been very successful in working with our customers to provide specific pricing to the five categories of product purchases that I described. I think we have been quite successful and I would anticipate we will complete this process throughout this fiscal year and perhaps slightly into next fiscal year. I think what you are seeing in our business is a continued focus on driving value for our customers on many dimensions. Certainly, the specialty business is focused on the clinics, the U.S. oncology business, the things we do outside of the hospital continues to perform very well and grow rapidly, but there is also a growing portion specialty that’s inside of our standard U.S. pharmaceutical business. That mix change continues to be reflected in some margin pressure in our business and that’s what we have been attempting to alleviate when we renegotiated these contracts, having said that, there is incremental profit being derived from the sale of the specialty items even in these hospital settings. So I think the margin expansion opportunity that we have achieved in the past has been partially driven by the move to generics, it’s certainly been driven by the efficiency in our operations and now it’s going to increasingly be driven by our ability to become more efficient in our operation to offset a little bit by the mix change that we are seeing.

I would add to that, John, that, clearly the focus is not just on the customers as we think about the growth of specialty we work very collaboratively across our customers and our manufacturing partners to find the value not only for our customers, but our manufacturer partners if you think about our specialty business which we have invested in, we have a range of services and capabilities that we can help provide our manufacturing partners as well. So our focus here is obviously to get the right compensation for all five categories, but we do that looking across collaboratively on manufacturing partners and our customers.

Okay. Maybe just one quick follow-up and I apologize if I missed it on Change Healthcare, have you given us an update on the timing for the IPO?

We haven’t been very specific on the timing, I think because we are continuing to evaluate when the best time is for that company to go public. It’s going to be dependent on our view of the synergy and the flow of the synergies that we outlined at the beginning of the business case, obviously, the revenue projections for the business and then clearly market conditions. So I think stay tuned as we get closer to picking a date, we will certainly advise you, but the plan remains as it has been to take the company to an LDO – or excuse me an IPO process.

Thanks for the comments.

Our next question comes from Ross Muken from Evercore ISI.

Hi, this is Elizabeth Anderson in for Ross. Just sort of following up on Glen’s question, can you touch more broadly about the opportunity that you see in specialty today versus in the past, I know that there has obviously been some changes and commentary from HHS about shift of Part D. The Part D is sort of, how would that impact U.S. oncology or sort of your thoughts more generally on the topic would be very helpful?

Well, certainly, the exposure we have in specialty continues to grow and we have put the company in a position where we think we can benefit through this new growth cycle. A lot of the innovation that’s coming from the pharmaceutical industry is coming as you mentioned in the specialty categories in particular in oncology. And as Britt was talking about a few minutes ago, some of the acquisitions we have done on the internal development we have done has been to provide incremental services to pharma manufacturers, particularly those that are focused on specialty launches and what can we do to support them. So we have an increasing revenue and profit stream coming from the manufacturer services part of our business both in medical and in pharmaceutical products and we continue to increase the exposure the company has and the opportunity we have to support those launches with the manufacturers. As it relates specifically to reimbursement, clearly, we are following that very closely. We do, our customers in particular, had some exposure to what type of reimbursement models the government might put in place, but I think clearly everyone would agree that service provided by community-based physicians provides not only better access and convenience at people, quality, but it also does it at a much lower cost. And so I think that certainly ourselves and other people that are involved in the channel would clearly recognize and the payers as well recognize that community-based services of these specialty products is the place that people should go. So I am pleased with our footprint and I think we will continue to grow nicely as these products come to market.

Alright, that was helpful. Thank you. And then as a follow-up outside of specialty, what are your, sort of organic and inorganic priorities given your general shift towards higher gross margin business segment?

Well, you can see some of it played out in the acquisitions that we are doing. And as we have talked about the acquisitions in last year and the years prior, we are obviously trying to increase our exposure to specialty in the manufacturer services which we have talked about. We would see us continuing to invest in our Medical-Surgical business, MSD is a good example of that and you have seen us continue to expand our ability to attract customers through innovation from a technology perspective. So I think you will see us continue to invest across some very good dimensions and we obviously have done some acquisitions in our U.S. pharmaceutical business as well that have performed very well. So, I think it remains opportunities for us to continue to expand our service for our customers.

Okay, great. Thank you.

We will take our next question from Brian Tanquilut with Jefferies.

Hi, good morning. John, as we think about these contract renegotiations and you have been talking about the services that you can offer to manufacturers, so how are you thinking about the ability to leverage some of these wraparound services and capabilities that you have and how that could help you, so as we think about the contract renegotiations?

Well, you mentioned manufacturers in the middle of it, so we do have obviously contracts with providers.

I am sorry, I mean contract with the providers, but do the services that you provide the manufacturers and the wraparound, I mean, does that help you at all as you look at negotiating your contracts with the clients – with the providers?

Well, I certainly think on many dimensions it will. In some cases, we have exclusive access to products that we might be shipping to do our specialty pharmacy businesses. Clearly, in the medical side of our business, we have special arrangements with lab supplies and others, so that our customers would have a difficult time finding the complete set of solutions from another source and so that would be part of it. I would say that the services we provide to our customers in our biggest business, our U.S. pharmaceutical business continues to be driven by our ability to innovate and help them deliver value beyond just the cost of goods that we provide. So you have seen this grow our business significantly, for example, with Health Marts over a decade now, over close to 5,000 stores and that’s driven largely not just by the price of our generics as an example but by the value we can deliver to the store, improving their profitability, improving their access to patients and putting them into these narrow networks and making sure that they are getting a consistent supply of customers and new customers and growing the way the relationship can become over time through a more fulsome set of capabilities and we are doing the same thing on many dimensions with our largest customers. And that’s why our renewal rate with our customer basis has been so successful. We mentioned in our prepared comments that we have renewed or continued or expanded or pushed out our date of expiration on these large independent GPO customers. So, almost all of those now have been renewed and have been expanded. That happens because of the total value that we are able to deliver to our customers. I mean, if you back and look at our customer retention across even our largest most sophisticated customers, we largely retain those customers unless there is something disruptive that happens in the marketplace. So I think we are quite confident that we will continue to build these relationships and continue to expand in it. That doesn’t mean that we don’t have price pressure in it. We don’t have to renegotiate and get back some of the efficiencies we have derived over years in serving the customer, which will provide obviously some downward pressure on our margins, which is reflected in our guidance. I think we remain pretty committed to adding value to our relationships and expanding them.

Now, appreciate it, John. Just my follow-up since you have touched on generics, as we think about your guidance for 2019 and then you talked earlier about the stability or 2018 was the stabilization year, what are you expecting in terms of generic pricing, what are you baking into the guidance at this point? Thanks.

Well, we don’t talk specifically about generic pricing. I would say the way we think about generics, that was when we want to be the best buyer of generics in the marketplace and we believe we are today or currently equal to everyone that’s sourcing generics, our scale is quite significant. ClarusONE has performed exceptionally well and our customers benefit from the scale that we provide and certainly the manufacturers do from the share we are able to deliver consistently to them through these relationships. On the sell side of our relationship, we are committed to making sure that our customers retain or I should say obtain a competitive price and we know where the market price is for our customers on a molecule by molecule basis and we are committed to making sure that they remain competitive. And in the middle, between those are the spread or the return that we get for the work that we do. So, I think we see a more normalized generic market as compared to the recent past and we are confident we continue to manage that business on both the buying side and the selling side appropriately.

I appreciate it. Thanks.

And our next question comes from Robert Jones of Goldman Sachs.

Great. Thanks for the questions. I just wanted to go back to the U.S. pharma and specialty business and how you are thinking about growth over time, I know you have mentioned Rite-Aid, we have talked about contract renewals, obviously M&A is always going to be a part of the algorithm, but John, if you take a step back you know the guidance for flat to down mid single-digit EBIT in that segment obviously a lot of moving pieces in ‘19, but if you take a step back, how are you thinking about growth in that business? I mean, is it flat to down the right algorithm or do you think that there is things based on even some of the things you just discussed, is there ways that could expand EBIT, grow EBIT as we look forward maybe even beyond ‘19 in the U.S. pharma and specialty segment?

Robert, I want to turn this question over to Britt in just a moment, because he has spent some time thinking about it. But I would – my earlier answer related to the total value proposition we delivered to our customers is part of the way we begin to grow profitability in the direction of revenue growth and clearly, that’s a priority for us. There are some near-term headwinds partially driven by mix, partially driven by our anticipation of contract renewals, I would say for the most part that the business is positioned to perform well and we really have a foundation setting year going on in our U.S. pharma and specialty business, but Britt maybe you can add some color?

Yes, thanks for the question. I would say that our ‘19 guide is really reflective of some of the customer loss activity in transition, but Rite-Aid stores that we mentioned during our prepared remarks, but as we think about that business, specialty has been outlined for us as one of the key pillars. We think we have a lot of services and capabilities that we can provide not only our customers, but our manufacturing partners. And we think that’s going to position us well to participate in the growth of specialty from a dollar profit growth perspective. We have also made a number of acquisitions that we outlined through FY ‘18 that we believe are going to continue to strengthen our position in not only specialty, but the manufacturer services component of that business. While we have some near-term headwinds as John outlined, the business we believe is well positioned to take advantage of growing specialty marketplace.

That’s helpful. And then I guess just to follow-up, you guys mentioned a multiyear cost initiative, can you share anything just as far as how much of that is expected to impact ‘19? And then I guess more specifically where within the segments and the corporate line should we be expecting to see a lot of those initiatives start to take hold?

Yes, sure. As we mentioned in our earlier remarks, we are in the preliminary phase of our operating model work. We have outlined for you an expected set of restructuring charges for that preliminary base and we have also outlined for you that we expect that these savings that will generate will be modest in FY ‘19 as we build through some of these capabilities and some of these cost programs that we are looking at. So, we are in early phases of it. In FY ‘19 you should expect to see some investments and some savings that will help fund those investments that will really benefit us as we go into ‘20 and beyond.

Alright. Thanks so much.

We will take our next question from Ricky Goldwasser with Morgan Stanley.

Yes, good morning and thank you for taking my question. The narrative out of Washington is very focused on the middleman and we are getting a lot of questions from investors about what a potential shift away from gross to net pricing model could impact you guys? So, John, can you just kind of like help us think through that and also how does – how and does this is being reflected in the some of the conversation that you are having with the manufacturers?

Well, thanks for the question, Ricky. Clearly, there is – unless the government decides to impose some type of price methodology and price fixing or some type of price controls like we have in other socialized countries, but the gross to net discussion is really one that is in some control with the pharmaceutical manufacturers. And as we analyze what’s being said and we think the question of middleman is primarily focused on people outside of the pharmaceutical wholesaling business, the people that are heavily involved in receiving and/or processing rebates, incentives etcetera. So, we don’t think the focus and the discussion is really wholesalers’ business model and so that will be a part of my reflection on the question. And the second is that you can imagine that at the net price it’s realized by pharmaceutical manufacturers is a derivative of all of the discounts that they are providing and rebates they are providing to many, many different customers. And if you were to think about how they would move to a single price and what effect that would have on their profitability, it will be quite dramatic. I don’t think the manufacturers would be inclined to move to a single price for all of their customers and to not use – to go forward without using some type of rebate in their incentive programs to recognize the various discounts that are required to obtain business from different players in the industry. Having said all of that if they were to pursue some type of an environment where our business model has changed and the economics would change for us, we would do what we have done in the past, which is to sit down with the manufacturers. I reflect to them what their change in behavior has done…

That’s very helpful. Thank you. And then Britt just one follow-up question on the guidance, I mean, obviously there is a wide range in guidance for U.S. North America operating income, it’s somewhere between flat to $150 million. You highlighted Rite-Aid, it’s about a third of the impact. So when we think about the low end of the guidance when we think about the swing factor, what is the biggest factor there outside of Rite-Aid, is it the sell side contracts renegotiation that you highlighted earlier in the call or is it something else?

No, well, thanks for the question. As John mentioned, we fully factor in all of the upcoming renewals into our guidance. So that’s already in there. I think what we are reflecting here is as we talked about before we have a couple of customer losses through consolidation in transition with Rite-Aid that is providing a little bit of a near-term headwind for us, but we continue to invest in the business through some of the acquisitions that we have outlined before and we believe that those acquisitions will continue to add value and be accretive to us over the longer term. So I think our guidance on the flat to down mid single-digit as you identified is really reflective of couple of customer losses that we talked about earlier in the call.

And perhaps, Ricky, what folks have missed is that there was a very large acquisition in the grocery business that affected us negatively and we don’t typically talk about specific customers or contracts and maybe some people measure that transaction and its effect on us as well in other grocery operators. We had a couple of transitions last year that we had not anticipated and really do largely to consolidation and we don’t anticipate that going forward, but you see it reflected at least partially in our guidance in addition to the loss of nearly half of those Rite-Aid stores.

And I would just reiterate as I talked about the generic environment, we do see a continuing competitive environment, but a more stable environment. I think that’s an important factor to just remind you of.

Which basically means that it might be a headwind, but it’s a stable one, so as we think about that range we should factor that as well, is that fair?

I think as I mentioned the sell side environment is competitive as it always has been, but it’s a very stable environment now as opposed to what we saw in fiscal ‘17.

Okay, thank you.

We will take our next question from Eric Percher with Nephron Research.

Thank you. I wanted to go back to the question on pharma and specialty and maybe you could put more simply, what is your view of the organic growth rates top line as well as the type of margin leverage de-leverage you would see on an organic basis kind of taking away the noise that we are seeing at the moment?

Well, thanks for that question, Eric. I will start off with that as we have outlined in our guidance here, our revenue is expected to grow low to mid single-digit. Now, that is reflective of some of the headwinds that we have already identified in our U.S. pharma business. Specialty is clearly the fastest growing product category in the marketplace today and while it has an impact on our margin rate, we are still participating well in growing margin dollars as a result of that specialty growth. And add to that, some of the things we have already talked about our position in specialty and some of the investments that we have made in specialty, it helps us to really leverage and capitalize on those opportunities to grow with specialty. So I think what you are seeing in our overall segment guide is a reflection of the headwinds from the customer losses, but specialty continues to grow nicely and we are continuing to participate in that op profit dollar growth.

I was just going to say is it fair to say that in a normal – given mix shift, the op profit growth would be modestly less than the revenue growth that’s reasonable, the investments that you are making are to drive op profit growth at or better than the top line growth rate?

I think that’s a fair way to characterize it.

Thanks, operator. I think we have time for one more question.

And we will take our final question from Michael Cherny with Bank of America/Merrill Lynch.

Good morning and thanks for the details so far. So one last question on the U.S. EBIT growth rate, you talked about some of the potential headwinds as you think about the bottom end of the range, if we get to the top end of the range in terms of the flattish number, where are the biggest drivers of that, is it better branded pricing that you expect, is it a push-out of some of the renewal pressure that you may or may not be feeling just trying to understand the full range of outcomes there to understand where the numbers could shake out as you are thinking about the various moving pieces in your business over the course of the year?

Thanks for that question. I think as we think about the range, there is a number of factors that can drive it. I have given you an idea of what our assumption is on branded pricing environment, which we expect to be similar to FY ‘18. So, certainly if the branded pricing inflation environment is different that could certainly impact it. We are very excited about the contributions from ClarusONE we think that we are making great progress there. We certainly have a lot of other opportunities in other product categories as we have talked about today and so that certainly is an element for us that we think that can help us continue to grow and to help our customers grow. And as specialty continues to grow and we continue to position ourselves well with some of the investments that we have made, I think that we are well-positioned to continue to take advantage of that. So, these are few of the factors that I would point out that could help us to get to closer to the top end of that range.

Thanks. That’s all I have.

Well, I want to thank you operator for your help today and thanks also to all of you on the call for your time. We have a clear strategy and a solid operating plan for fiscal 2019 and exciting growth opportunities across McKesson. Please enjoy the holiday weekend. And now, I will hand the call off to Craig for a review of his upcoming events for the financial community. Craig?

Thank you, John. We will participate in the Goldman Sachs Global Healthcare Conference in Southern California on June 13 and we will be hosting an Investor Day event on June 28 in Boston. We look forward to seeing you in the new fiscal year. Thank you and good bye.

Thank you for joining today’s conference call. You may now disconnect. Have a good day.