Drug Retail Industry Report

October 25, 2010

Industry Analysis

Drug Retail Industry

Industry Overview

Q1 2011

The drugstores industry, part of the larger food and staples retailing industry, is a high-volume, low-margin business, with cutthroat competition. This is a mature industry and non-cyclical in nature. The staples offered at these stores make the industry non-cyclical. Drugstores can be independent, chains, part of supermarkets, and included in mass merchandiser stores. Independent mom-and-pop drugstores are on the decline. Typically, chains are drugstore owners with four or more stores. Chains average over 8,500 square feet per store, generate more than $5 million in revenue, and 60 percent of revenue is from pharmacy sales. Independent drugstores average 3,000 square feet per store and $2 million in revenue, with 90 percent of revenue derived from pharmacy sales. The drugstores industry is much more concentrated than the grocery stores industry. In 2008, 37,804 traditional drugstores existed, which are stores not part of larger stores such as supermarket superstores and mass merchant supercenters, and not mail order operations. Of the traditional stores, 20,884 were part of chains, with the top-three (CVS, Walgreens, and Rite Aid) dominating this landscape. The number of all drugstore outlets, including mass merchants and supermarkets with pharmacies, in 2008 was 53,658. But despite its concentrated nature relative to grocery stores, this segment is not very concentrated compared to most industries, and is highly competitive. The total number of outlets does not include one of the fastest growing segments of mail order pharmacy sales, which consisted of almost 22 percent of prescription drug revenue in 2008. Revenue. In 2008, revenue for traditional drugstores grew 3.1 percent to $203.8 billion, with chains growing 2.9 percent to $104.1 billion in revenue. Of the $253.6 billion (3.5 billion scripts) in prescription drug sales in 2008, up 1.8 percent from 2007, traditional drugstore chains accounted for 41.1 percent of revenue (46.6 percent of scripts dispensed), traditional independent drugstores accounted for 17.2 percent (21.8 percent), supermarkets 10.2 percent (13.6 percent), mass merchants 9.8 percent (11.3 percent), and mail order 21.7 percent (6.7 percent). It is interesting to note that the mail order numbers reflect that each script represents larger amounts of prescription drugs per order. Cost Structure. Many of the same costs that apply to grocery stores also apply to drugstores, which is a detail-oriented, labor-intensive business. Close to half of operating expenses are labor expenses, including wages, benefits, and recruiting and training in a high-turnover industry. Other significant costs include rent, renovations, store equipment, stocking and loading equipment, inventory management equipment, and energy costs. One notable difference from grocery stores is that their nonunion labor force gives them a competitive advantage in labor cost and flexibility. However, the advantages of nonunion employees might be all but negated by the high cost of pharmacists. The rapid growth in prescriptions written has made pharmacists scarce, which is accelerating wage growth and recruitment costs.

For more information: +1.212.897.4800 support@advisen.com www.advisen.com

Industry Trends
The drugstores industry is going through dramatic changes, placing even greater competitive pressures on this already cutthroat industry. Not the least of these challenges is the onslaught of mass merchants supercenters into the drugstore realm. The largest drugstore chains are increasingly entering each others territory, and see more competition from not only mass merchants, but also supermarkets and mail-order options. Drugstores are fighting back with larger store sizes, consolidation, superior service, and private label brands. Making operations more efficient has become essential for players in this industry, which has spurred use of new technology. Many long-term societal trends such as the aging population and the new Medicare prescription drug plan might benefit drugstores. Trends, opportunities, and threats in this industrys environment follow: Supercenters Attack Mass merchant supercenters are proliferating, and revenue from drugstore items are growing with them. Mass merchants such as Wal-Mart have cost advantages over traditional drugstore formats. Wal-Mart uses its grocery and drug offerings to woo customer traffic. This allows supercenters to sell groceries on much thinner profit margins. Mass merchants have other cost advantages over traditional drugstores, such as economies of scale and inexpensive locations. Most importantly, Wal-Marts size gives it buying power over vendors as never seen before in retail, allowing it to negotiate merchandise costs, helping to keep prices low for its customers. Drugstore Competition Heightens After a decade of consolidation, culminating in three giants in the drugstore segment (i.e., CVS, Walgreen, and Rite Aid), the big-three chains are now trolling on each others turf and the turf of other large chains. They are often clustered together in the same neighborhood. Competition is also coming from supermarkets and mass merchant supercenters. Mass merchant supercenters are the low-cost operators, so their pharmacies attract cash-paying customers without insurance. They will benefit during times when employers are pulling back on health plans, forcing consumers to directly purchase more prescriptions. Mail-order operations are also booming for prescriptions. Pharmacy benefit managers (PBMs) use mail-order pharmacies, and often use online ordering techniques, to fill prescriptions for those with regular prescription use. Drugstores Respond Drugstores are fighting back by offering an expanded selection of food and general merchandise, requiring larger store sizes. This increases the economies of scale of each store and creates higher margin opportunities. Also, companies are becoming larger through acquisitions, and despite being more concentrated than many food and staples retailing industry segments, consolidation opportunities abound even for the largest chains. Larger firms allow for economies of scale and buying power that the mass merchants, and increasingly larger supermarkets, enjoy. Although drugstore chains have been reorganizing, becoming larger and stripping out costs to become more efficient, mass merchant supercenters have a cost advantage that cannot be completely matched by the drugstore model. Like supermarkets, drugstores are offering private-label brands, whose OTC drugs benefit from their credibility. They further take advantage of their credibility with newly expanding in-store clinics, serving those without a regular physician. Long-Term Trends Affecting Drugstores As Baby Boomers continue the inevitable march toward their senior years, drug use is expected to grow at increasing rates. The new Medicare prescription-drug coverage law passed in November 2003 was phased in and took full effect in 2006. Healthcare reform was passed in March 2010, which will expand Medicare prescription-drug coverage, as well as result in more people with healthcare insurance coverage. These new laws mean that a large group of previously uninsured people now and will soon have coverage for prescriptions. This converts a large part of the cash-paying, high-margin customer base into third-party-paying, low-margin customers. Although this could be bad news for drugstores, it could result in an opportunity to regain customers lost to mass merchants. It will certainly encourage more prescription drug purchases from those delaying the purchase of unaffordable drug regimens. In the much longer-term, however, this development could potentially hurt all pharmacy outlets. As drug prices rise, the government might start exerting price pressures on participants across-the-board, from pharmaceutical companies to retailers. Use of generic drugs is growing and reshaping the drugstores industry. They offer retailers higher margins over brand drugs, and customer and third-party payers receive substantial discounts. The pharmacist shortage is making pharmacies

For more information: +1.212.897.4800 support@advisen.com www.advisen.com

increasingly more expensive to operate. Many drugstores are responding to this problem by cutting pharmacy hours, intensifying recruitment efforts, and increasing the number of technicians assisting pharmacists. Efficiency is Paramount The drugstores industry has always been a high-volume, low-margin business. But the recent rise in competition from mass merchants and each other has made margins thinner than ever before. For the sake of survival, drugstore players need to remain lean and efficient. Most well managed companies in this industry are implementing efficient customer response (ECR) programs, which are efforts to streamline distribution, forge stronger partnerships with suppliers, and lower prices. Many retailers, particularly Wal-Mart, are employing radio frequency identification (RFID) tags to reduce costs. The pharmacist shortage has prompted drugstores to invest in automatic dispensing equipment, which are robotics for fulfilling prescriptions. Computer information systems and workflow software are being used to help handle the increased number of prescriptions and to serve customers better. Mergers and Acquisitions. Increased competition has caused further consolidation of drugstores. In July 2004, CVS acquired 1,260 Eckerd stores from JC Penney for $2.15 billion. Then in June 2006, CVS acquired 700 Osco and Sav-On drugstores from the Albertsons implosion for $2.9 billion. Rite Aid beefed up its position among the big-three by agreeing in August 2006 to acquire 1,860 Brooks and Eckerd (the stores not acquired by CVS in 2004) stores from the Jean Coutu Group for $2.55 billion in cash and stock plus $850 million of assumed debt, for a total of $3.4 billion. Perhaps the most direct response to outside competition for traditional drugstores is CVS (now CVS Caremark) acquiring PBMgiant Caremark Rx (now Caremark Pharmacy Services). In mid-2007, CVS purchased Caremark Rx for $26.5 billion, which could usher in a new era for drugstores. Drugstores are benefiting from their drug-savvy credibility by offering in-store clinics. These clinics serve the 30% of the U.S. population that doesnt have a regular physician. Each clinic is staffed with a nurse practitioner, and handles minor medical conditions. In September 2006, CVS acquired MinuteClinic, the largest retail-based health clinic in the US. In May 2007, Walgreen acquired TakeCare Health Systems. Both plan on expanding their in-store clinics, but Wal-Mart also plans to expand the number of its in-store clinics.

SIC Codes in this Sub-Industry:

Sub-Industry: SIC Codes: 5910 5912 Drug Stores And Proprietary Stores Drug Stores And Proprietary Stores Drug Retail (30101010) Owners and operators of primarily drug retail stores and pharmacies.

For more information: +1.212.897.4800 support@advisen.com www.advisen.com

MSCAd Industry Large Losses

Advisen's Master Significant Case & Action database (MSCAd) compiles details and statistics on significant large losses, including management liability cases such as securities class actions, auditing and other management malpractice, state and federal government regulatory fines, employment liability cases and errors and omissions litigation. This also includes EEOC settled litigation, ERISA/Fiduciary Duty, Malpractice, Anti-Trust, Fraud, Trade Practices, and Contract Cases. MSCAd is the most comprehensive, accurate source of this data available to the industry. Our information is compiled by a dedicated research team using numerous sources such as Stanford Securities, Federal agencies such as the Department of Justice, the EEOC, and the Securities & Exchange Commission, research tools such as LEXIS/NEXIS, major law firms and claims administrators, State insurance commissioners and attorneys general, and other sources. The consolidated data is subject to ongoing review and rigorous audit procedures to ensure both accuracy and timeliness. Cases Filtered For: Industry Filters Dates: Industries: Case Count: 2010,2009,2008,2007,2006 5910 Drug Stores And Proprietary Stores 5912 Drug Stores And Proprietary Stores 112

MSCAd Large Losses 5 Year Trend

For more information: +1.212.897.4800 support@advisen.com www.advisen.com

MSCAd Large Losses Case Category Breakdown

For more information: +1.212.897.4800 support@advisen.com www.advisen.com

MSCAd Large Losses - Line of Business

For more information: +1.212.897.4800 support@advisen.com www.advisen.com

MSCAd Large Losses Recent 10 cases

Case ID 651531 Company Name Duane Reade Inc. CVS Caremark Corporation CVS Caremark Corporation CVS Caremark Corporation CVS Caremark Corporation CVS Caremark Corporation CVS Caremark Corporation CVS Caremark Corporation CVS Caremark Corporation CVS Caremark Corporation Company ID 1012507 Category/Type Accident Date 01/01/2008 Filing Date 01/20/2011 Status Total Amount($)

General Litigation/ Undetermined Employment/ Discrimination & Harassment: Racial Employment/ Wage and Hour Intellectual Property/ Trademark Infringement Employment/ Wrongful Termination Business & Trade Practices/Breach of Contract Employment/

Pending

650149

1000616

12/21/2010

Pending

650157

1000616

12/13/2010

Pending

650754

1000616

09/01/2010

12/09/2010

Pending

650685

1000616

12/08/2010

12/08/2010

Pending

647656

1000616

12/01/2010

12/03/2010

Pending

650160

1000616 Wage and Hour Employment/ 1000616 Wage and Hour Employment/ 1000616 Wage and Hour Products & Services/ 1000616 Product Usage 09/22/2010

11/23/2010

Pending

650183

11/23/2010

Pending

650191

11/23/2010

Pending

650088

11/08/2010

Dismiss ed

For more information: +1.212.897.4800 support@advisen.com www.advisen.com

MSCAd Large Losses Top 10 by Settlement Amount ($)

Case ID Company Name CVS Caremark Corporation Company ID Category/Type Accident Date Filing Date Status Total Amount($)

643660

1000616

Penalties/Regulatory, Compliance, Taxation

09/01/2007

10/12/2010

Settled

$77,600,000

606446

Walgreen Company Walgreen Co. CVS Caremark Corporation

1010736

Products & Services/ Third Party Liability Employment/ Discrimination & Harassment: Racial Securities/Breach of Fiduciary Duties: Class Action 01/02/2003

08/19/2007

Award

$25,800,000

608890

1010736

03/07/2007

Settled

$24,500,000

615703

1000616

12/21/2006

Settled

$20,000,000

419122

CVS Caremark Corporation

1000616

Employment/Wage and Hour

03/17/2002

03/17/2006

Settled

$19,750,000

623459

Albertson's LLC Caremark Rx, Inc. Walgreen Co. Walgreen Co C&K Express, LLC

3636903

634607

1064564

Employment/ Discrimination & Harassment: Racial Securities/Derivative Shareholder Action Products & Services/ Third Party Liability Business & Trade Practices/Sales Practices Management & Strategy/ ERISA violations

01/02/1995

03/28/2008

Settled

$8,900,000

05/26/2006

Settled

$7,500,000

609220

1010736

10/18/2007

Award

$6,000,000

637221

1010736

03/23/2010

Settled

$5,970,000

645722

7061290

10/29/2010

Settled

$3,000,000

For more information: +1.212.897.4800 support@advisen.com www.advisen.com

Insurance Program Pricing

ADVx tracks changes in average premiums paid upon the renewal of commercial lines insurance policies. The index is the composite of four lines of business: domestic property, general liability, workers compensation and directors & officers liability, weighted by their relative premium volume as reported in Best's Aggregates and Averages. Premiums are adjusted to 2000 dollar value. Policy renewal data are collected and compiled by Advisen from retail and wholesale insurance brokers and risk managers.

Composite

Percent Change

Individual Lines of Business

Percent Change

For more information: +1.212.897.4800 support@advisen.com www.advisen.com

Competitors
Top 6 U.S. Public Companies Sorted by Market Cap
Ticker Company Name CVS Caremark Corporation Market Cap (in Millions) 44,883.59 Sales (in Millions) 98,729.00 Employees Sales Per Employee Net Income Price Earnings Ratio

CVS

295,000

334,674.57

3,696.00

13.07

WAG

Walgreen Co

39,027.38

67,420.00

244,000

276,311.47

2,091.00

18.72

RAD

Rite Aid Corp. Liberator Medical Holdings Inc Assured Pharmacy Inc My Healthy Access Inc

1,112.80

25,669.12

97,500

263,272.99

-506.68

-1.92

LBMH

56.16

25.82

APHY

0.18

13.92

39

357,012.48

MYHA

0.01

0.69

55

12,527.27

-5.97

-0.01

Top 7 U.S. Private Companies Sorted by Sales

Company Name Walgreen Drug Stores Usn Corp. Rite Aide Pharmacy Medical Center Pharmacy Wal Mart Pharmacy # 2121 Drug World Pharmacies National Senior Care, Inc. Sales (in Millions) 50,000.00 49,124.00 16,840.00 8,103.50 4,875.07 4,000.00 3,106.70 Employees 179,000 355,000 38,448 7,522 21,274 6,566 35,000 Sales Per Employee 279,329.60 138,377.46 437,994.17 1,077,306.56 229,156.42 609,198.90 88,762.85

For more information: +1.212.897.4800 support@advisen.com www.advisen.com

10

Stock and Financial Performance Trends

Stock Chart of Top 4 Companies by Market Cap

CVS

WAG

RAD

MYHA

S&P Industry

Drug Retail Income Statement

CVS Caremark Corporation Most Recent Quarter Date Sales Cost of Goods Sold Selling, General and Administrative Expense Operating Income Before Depreciation Depreciation and Amortization Operating Income After Depreciation 09/30/2010 $23,874.00M $18,480.00M Walgreen Co 11/30/2010 $17,344.00M $12,126.00M Rite Aid Corp. 11/30/2010 $6,202.35M $4,436.22M My Healthy Access Inc 9/30/2007 $0.14M $0.06M Average Industry 9/30/2010 $251.54M $187.66M

$3,541.00M

$3,997.00M

$1,594.39M

$1.1M

$46.88M

$1,853.00M

$1,221.00M

$171.74M

$(1.02)M

$17.85M

$370M

$273M

$124.98M

$0.04M

$3.92M

$1,483.00M

$948M

$46.76M

$(1.06)M

$13.94M

For more information: +1.212.897.4800 support@advisen.com www.advisen.com

11

CVS Caremark Corporation Nonoperating Income (Expense) Special items Pretax Income Income Taxes - Total Minority Interest Income Before Extraordinary Items Dividends - Preferred Income Before Extraordinary Items Available for Common Common Stock Equivalents - Dollar Savings Income Before Extraordinary Items Adjusted for Common Stock Equivalents Net Income (Loss) $820M

Walgreen Co

Rite Aid Corp.

My Healthy Access Inc

Average Industry

$1M $0M $1,347.00M $528M $(1)M

$3M $(7)M $921M $341M

$6.3M $0M $(80.68)M $(1.61)M $0M

$0M $(0.03)M $(1.15)M $0M $0M

$0.02M $(0.12)M $12.87M $4.88M $(0.01)M

$820M $0M

$580M $0M

$(79.07)M $2.38M

$(1.15)M $0M

$7.99M $0M

$580M

$(81.45)M

$(1.15)M

$7.99M

$0M

$0M

$0M

$0M

$0M

$820M $809M

$580M $580M

$(81.45)M $(79.07)M

$(1.15)M $(1.15)M

$7.99M $7.92M

For more information: +1.212.897.4800 support@advisen.com www.advisen.com

12

Drug Retail Balance Sheet

CVS Caremark Corporation Most Recent Quarter Date 09/30/2010 11/30/2010 11/30/2010 9/30/2007 Walgreen Co Rite Aid Corp. My Healthy Access Inc Average Industry 09/30/2010

Assets Cash and Short Term Investments Accounts Receivable/Debtors-Total Inventories - Total Current Assets - Other Total Current Assets - Total Property, Plant and Equipment - Total (Net) Intangible Assets - Total Assets - Other - Total Assets - Total Liabilities and Net Worth Debt in Current Liabilities Total Current Liabilities - Other Current Liabilities - Total Long-Term Debt - Total Long-Term Debt Due in One Year Account Payable/Creditors Trade Deferred Taxes - Balance Sheet Liabilities - Other Income Taxes Payable $36,018.00M $61,713.00M $3,184.00M $27,044.00M $1,150.07M $7,815.97M

$983M

$2,062.00M

$122.04M

$0M

$17.74M

$5,111.00M $10,585.00M

$2,472.00M $7,909.00M

$974.47M $3,330.80M

$0.02M $0.02M

$46.84M $111.27M

$660M $17,339.00M

$220M $12,663.00M

$100.04M $4,527.36M

$0M $0.05M

$5.41M $181.26M

$8,356.00M

$11,197.00M

$2,138.54M

$0.42M $0M $0.02M $0.02M

$121.04M N/A $242.75M $545.05M

$2,488.00M $5,024.00M $11,674.00M $8,653.00M

$13M $2,780.00M $8,149.00M $2,389.00M

$34.25M $1,107.24M $2,433.83M $6,214.85M

$2.75M $0.52M $4.56M $0M

$15.52M $48.21M $118.36M $68.94M

N/A

N/A

N/A

N/A

N/A

$4,162.00M

$4,955.00M

$1,292.35M

$1.29M

$54.18M

$3,653.00M $1,061.00M $0M

$360M $1,783.00M $401M

$0M $1,175.50M

$0M $0M $0M

$24.6M $16.78M $0.45M

For more information: +1.212.897.4800 support@advisen.com www.advisen.com

13

CVS Caremark Corporation Minority Interest Preferred/Preference Stock (Capital) - Total Common/Ordinary Equity Total Common/Ordinary Stock (Capital) Treasury Stock - Total (All Capital) Capital Surplus/Share Premium Reserve Retained Earnings Shareholders Equity-Total $35M

Walgreen Co $0M

Rite Aid Corp. $0M

My Healthy Access Inc $0M

Average Industry $0.22M

$0M

$0M

$159.26M

$0M

$0M

$36,637.00M

$14,363.00M

$(2,167.48)M

$(3.97)M

$316.15M

$16M

$80M

$890.32M

$0.06M

$0.59M

$9,085.00M

$3,594.00M

$0M

$0M

$75.49M

$27,443.00M $18,263.00M $36,637.00M

$708M $17,169.00M $14,363.00M

$4,280.46M $(7,338.26)M $(2,008.22)M

$7.33M $(11.36)M $(3.97)M

$174.23M $216.81M $316.15M

Drug Retail Cash Flow

CVS Caremark Corporation Most Recent Annual 09/30/2010 Date Operating Activities (Indirect) Depreciation and Amortization Operating Activities New Cash Flow Investing Activities Investing Activities Net Cash Flow Capital Expenditures Financing Activities Cash Dividends (Cash Flow) Financing Activities - Net Cash Flow 08/31/2010 2/28/2010 12/31/2006 12/31/2009 Walgreen Co Rite Aid Corp. My Healthy Access Inc Average Industry

$1,389.00M

$1,030.00M

$534.24M

$0.02M

$14.17M

$4,035.00M

$3,744.00M

$(325.06)M

$(1.81)M

$53.56M

$(1,069.00)M $2,548.00M

$(1,274.00)M $1,014.00M

$(120.49)M $183.86M

$(0.33)M $0.26M

$(21.31)M $24.61M

$439M

$541M

$0M

$0M

$5.41M

$(3,232.00)M

$(2,677.00)M

$397.11M

$2.11M

$(23.95)M

For more information: +1.212.897.4800 support@advisen.com www.advisen.com

14

Financial Ratios Comparisons

Valuation Ratios CVS Caremark Corporation Price to Earnings (TTM) Price to Sales (TTM) Profitability Ratios(%) CVS Caremark Corporation Operating Margin (TTM) Operating Margin (TTM) 3 Year Avg. EBITDA Margin (TTM) EBITDA Margin (TTM) 3 Year Avg. Pretax Margin (TTM) Pretax Margin (TTM) 3 Year Avg. Effective Tax Rate (Annual) Effective Tax Rate (Annual) 3 Year Avg. Management Effectiveness Ratios CVS Caremark Corporation Return on Assets Return on Assets (3 Year Avg.) Return on Equity Return on Equity (3 Year Avg.) 5.61 5.84 9.59 0 Walgreen Co 8.14 8.56 15.06 0 My Healthy Access Inc -1,550.33 -1,403.42 321.99 0 11.07 11.09 Average Industry 6.4 6.21 Walgreen Co 5.47 My Healthy Access Inc -772.26 Average Industry 5.54 13.07 0.46 Walgreen Co 18.72 0.57 My Healthy Access Inc -0.01 0.02 Average Industry 15.64 0.52

Rite Aid Corp.

-1.92 0.04

Rite Aid Corp.

0.75

6.53 7.76

5.06 7.04

0.53 2.77

-2,519.19 -745.26 7.48

7.95 0

6.63 0

2.64 0

-1,853.69 -6,105.81 1,102,948.16 -772.26

7.39 5.53

0 39.2

0 37.02

0 2

5.53 39.14

38.71

37.25

-34.73

-2,519.19

35.93

Rite Aid Corp.

-6.8 -15.45 29.41 0

For more information: +1.212.897.4800 support@advisen.com www.advisen.com

15

Coverage & Leverage Ratio CVS Caremark Corporation Times Interest earned (TTM) EBITDA/Interest(TTM) EBITDA Capex/Interest (TTM) Debt to Capital (MRQ) Debt to Equity (MRQ) Debt (avg. 12 mos.) to EBITDA (TTM) Free CF (TTM) to Total Debt (avg. 12 mos.) Liquidity & Activity Ratios CVS Caremark Corporation Current Ratio (MRQ) Quick Ratio (MRQ) AR Turnover (MRQ) Inventory Turnover AP Turnover 1.49 0.52 18.04 7.36 18.62 Walgreen Co 1.55 0.56 27.09 6.24 9.59 My Healthy Access Inc 0.01 0.01 29.68 28.14 1.01 10.82 13.53 Walgreen Co 41.22 53.09 My Healthy Access Inc -18.56

Rite Aid Corp.

Average Industry

0.35 1.28

15.57 19.49

3.46 0.23 0.3

41.22 0.14 0.17

0.5 1.47 -2.88 -2.26 -0.69

14.45 0.21 0.26

1.49

0.51

10

-0.25

1.12

18.75

91.49

3.2

-196.62

0.34

Rite Aid Corp.

Average Industry

1.86 0.45 24.53 5.23 13.7

1.53 0.54 21.11 7.14 11.85

For more information: +1.212.897.4800 support@advisen.com www.advisen.com

16

Recent Industry News of Top 5 Competitors

Walgreen Company To Acquire Online Retailer drugstore.com, inc.

2011-03-24
Walgreens Company and drugstore.com, inc. announced a definitive merger agreement pursuant to which Walgreens will acquire drugstore.com in a transaction with a total enterprise value of approximately $409 million. Under the terms of the merger agreement, drugstore.com stockholders will receive $3.80 in cash for each share of stock, which represents an equity value of approximately $429 million. The price per share is a premium of approximately 102% over drugstore.comaCOs 30-day average closing stock price, and a premium of approximately 113% over the closing price of drugstore.comaCOs common stock on March 23, 2011, the last trading day prior to announcement. As a result of the merger, Walgreens will acquire the drugstore.com website in addition to other websites operated by the company.

CVS Caremark Corporation Announces Quarterly Dividend

2011-03-09
CVS Caremark Corporation announced that its Board of Directors has approved a quarterly dividend of $0.125 per share on the Common Stock of the Corporation, payable May 3, 2011 to holders of record on April 22, 2011.

Catalyst Health Solutions, Inc. To Acquire Walgreens Co.'s Pharmacy Benefit Management Subsidiary,

2011-03-09
Catalyst Health Solutions, Inc. announced that it has entered into a definitive agreement with Walgreen Co. to acquire Walgreens' pharmacy benefit management (PBM) subsidiary, Walgreens Health Initiatives, Inc. (WHI), for $525 million in cash. Catalyst will enter into an agreement with Walgreens to provide PBM services for WalgreensaCO 244,000 active employees in addition to retirees and dependents, as well as an agreement to administer the Walgreens Prescription Savings Club.

Liberator Medical Holdings, Inc. Comments On Quarterly 2011 Revenue Guidance

2011-02-23
Liberator Medical Holdings, Inc. announced that it expects revenues to continue to grow over the next three quarters of fiscal 2011 due to its advertising and marketing programs.

CVS Caremark Corporation Issues FY 2011 EPS Guidance Below Analysts' Estimates

2011-02-03
CVS Caremark Corporation announced that for fiscal 2011, it expects Adjusted diluted EPS from continuing operations expected to be in the range of $2.72-$2.82 and GAAP diluted EPS from continuing operations expected to be in the range of $2.52-$2.62. According to Reuters Estimates, analysts are expecting the Company to report adjusted EPS of $2.89 and GAAP diluted EPS of $2.74 for fiscal 2011.

CVS Caremark Corporation Announces Management Change

2011-01-24
CVS Caremark Corporation announced the next stage of its transition plan outlined during its Annual Shareholders meeting last year. After the successful transition of day-to-day responsibilities for the Company's retail operations earlier this month, the Company has announced that Larry Merlo, President and Chief Operating Officer of CVS Caremark, will assume the role of Chief Executive Officer (CEO) effective March 1, 2011. Thomas M. Ryan will remain Non-Executive Chairman until his retirement at the Company's Annual Meeting of Shareholders in May of 2011.

For more information: +1.212.897.4800 support@advisen.com www.advisen.com

17

Walgreen Company Declares Regular Quarterly Dividend

2011-01-13
Walgreen Company announced that it has declared a regular quarterly dividend of $0.175 per share, a 27.3% increase over the year-ago dividend. The dividend is payable March 12, 2011, to shareholders of record February 18, 2011.

Rite Aid Corporation Lowers High End Of Prior FY 2011 Revenue Guidance To A Range In Line With Analysts' Estimates; Lowers FY 2011 Earnings Guidance; Lowers FY 2011 Same Store Sales Guidance

2010-12-16
Rite Aid Corporation announced that based on its third quarter 2010 results and its lower expectation for same store sales in the fourth quarter of 2010, the Company lowered its fiscal 2011 guidance for sales and Adjusted EBITDA and increased fiscal 2011 guidance for net loss. Sales are now expected to be between $25.0 billion and $25.2 billion with same store sales expected to range from a decrease of 1.5% to a decrease of 0.9%. Adjusted EBITDA is expected to be between $815 million and $855 million. Net loss is expected to be between $655 million or $0.74 per diluted share and $525 million or $0.60 per diluted share. According to Reuters Estimates, analysts on were expecting the Company to report revenue of $25.2 billion, EBITDA of $815 million, net profit of $(489) million and EPS of $(0.56) for fiscal 2011.

Liberator Medical Holdings, Inc. To Restate Financial Results For Non-Cash Adjustments

2010-12-10
Liberator Medical Holdings, Inc. announced that it would restate the Company's previously issued unaudited financial statements for the interim periods ended December 31, 2009, March 31, 2010, and June 30, 2010, to comply with certain accounting guidance that became effective for the Company on October 1, 2009. The changes are to non-cash items and will not affect the Company's reporting income, operating income, operating expenses, total assets, or cash position for the three quarters to be restated. The restatement resulted from the Company's reevaluation of the accounting treatment of certain convertible notes issued by the Company to a single investor in May and October 2008. The notes were converted into the Company's common stock in May and October 2010, respectively. The notes contained embedded anti-dilution provisions that could have led to adjustments in the conversion price of the notes if the Company had issued additional shares of common stock or like securities at a price per share less than both the conversion price then in effect and $0.75, which the Company did not do at any time after the notes were issued.

Assured Pharmacy, Inc. Receives Gross Proceeds Of $300,000 From Sale Of Convertible Debentures And Warrants

2010-12-08
Assured Pharmacy Inc announced that it has sold in a private placement to an accredited investor a 12.5% senior convertible debenture for an aggregate principal amount of $300,000 (before deducting expenses and fees related to the private placement). The debentures are convertible into shares of the Company's common stock at an initial conversion price of $0.008 per share, subject to adjustment. As part of the private placement, the investor received a warrant to purchase 45,000,000 shares of the Company's common stock. The warrant is exercisable for a period of three years from the date of issuance at an initial exercise price of $0.0096, subject to adjustment. The investor may exercise the warrant on a cashless basis if the shares of common stock underlying the Warrant are not then registered pursuant to an effective registration statement. The funds received from the investor will be directed to the continued development of the Company's business plan and general working capital purposes.

Rite Aid Corporation Raises FY 2011 Net Profit Guidance; Narrows FY 2011 EBITDA Guidance; Lowers FY 2011 Revenue Guidance; Lowers FY 2011 Same Store Sales Guidance

2010-09-23
Rite Aid Corporation lowered its fiscal 2011 outlook and expects sales to be between $25.0-$25.4 billion, with same store sales expected to range from a decrease of 1.5% to flat and Adjusted EBITDA (which is reconciled to net loss on the attached table) is expected to be between $875-$950 million. Net loss to be between $400-$590 million or a loss per diluted share (EPS) of $0.46 to $0.67. According to Reuters Estimates, analysts on were expecting the Company to report revenue of $25.3 billion, EBITDA of $843 million net profit of $(426) million and EPS of $(0.48) for fiscal 2011.

For more information: +1.212.897.4800 support@advisen.com www.advisen.com

18

Liberator Medical Holdings, Inc. Comments On Long Term Guidance

2010-08-16
Liberator Medical Holdings, Inc. announced that it believes that it is well positioned to continue to grow its sales and improve profitability over the long term.

Rite Aid Corporation Announces Offering Of Senior Secured Notes 2010-08-09

Rite Aid Corporation announced its intention to offer $650 million aggregate principal amount of senior secured notes due 2020. The notes will be unsecured, unsubordinated obligations of Rite Aid Corporation and will be guaranteed by substantially all of Rite Aid's subsidiaries. The guarantees will be secured on a senior lien basis. The proceeds of the offering will be used, together with available cash, to repay and retire Rite Aid's $648.0 million Tranche 4 Term Loan due 2015 under its senior secured credit facility, and to fund related fees and expenses.

For more information: +1.212.897.4800 support@advisen.com www.advisen.com

19