What changed in this filing

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Item 1. Business

2022-11-22 compared with 2021-11-23 · 146 added, 131 removed, 156 unchanged (64% of the section changed)

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Pharmaceutical manufacturers' continued emphasis on research and development is expected to result in the continuing introduction of cost-effective drug therapies and new uses for existing drug therapies.

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Legislative Developments.

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Subsequent legislation and rules promulgated by government agencies have made additional changes to federal drug payment policies.

These policies and other legislative developments (including potential revisions to or repeal of any portions of the health reform legislation) may affect our businesses directly and/or indirectly (see Government Regulation on page 8 and the risk factor titled Legal, regulatory, and legislative changes with respect to reimbursement, pricing, and contracting may adversely affect our business and results of operations, including through declining reimbursement rates on page 16 for further details).

These policies and other legislative developments (including potential revisions to or

repeal of any portions of the health reform legislation) may affect our businesses directly and/or indirectly (see Government Regulation a nd the risk factor titled Legal, regulatory, and legislative changes with respect to reimbursement, pricing, and contracting may adversely affect our business and results of operations, including through declining reimbursement rates for further details).

COVID-19 Pandemic.

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These items include, but are not limited to, the financial condition of our customers and the realization of accounts receivable, changes in availability and demand for our products and services, changes in operating costs, and delays related to current and future projects.

While our operational and financial performance may be significantly impacted by COVID-19, it is not possible for us to predict the duration or magnitude of the outbreak and whether it could have a material adverse impact on the Company's financial position, results of operations, or cash flows (see Risk Factor - We face risks related to health epidemics and pandemics, and the continued spread of COVID-19 has had adverse effects on our business).

While our operational and financial performance may be significantly impacted by COVID-19, it is not possible for us to predict the duration or magnitude of the outbreak and whether it could have a material adverse impact on the Company's financial position, results of operations, or cash flows (see Risk Factor - We face risks related to health epidemics and pandemics, and the ongoing spread of COVID-19 has had adverse effects on our business).

Other economic conditions and certain risk factors could adversely affect our business and prospects (see Item 1A.

Risk Factors on page 11).

Risk Factors).

We serve our customers (healthcare providers and pharmaceutical and biotech manufacturers) through a geographically diverse network of distribution service centers and other operations in the United States and select global markets.

In our pharmaceutical distribution business, we are typically the primary supplier of pharmaceutical and related products to our healthcare provider customers.

In our pharmaceutical distribution businesses, we are typically the primary supplier of pharmaceutical and related products to our healthcare provider customers.

We offer a broad range of services to our customers designed to enhance the efficiency and effectiveness of their operations, which allow them to improve the delivery of healthcare to patients and to lower overall costs in the pharmaceutical supply channel.

Our business strategy is focused on the global pharmaceutical supply channel where we provide value-added distribution and global commercialization services to healthcare providers (primarily pharmacies, health systems, medical and dialysis clinics, physicians, and veterinarians) and pharmaceutical manufacturers that improve channel efficiencies and patient outcomes.

Implementing this disciplined and focused strategy in a seamless and unified way has allowed us to significantly expand our business, and we believe we are well positioned to grow revenue and increase operating income through the execution of the following key elements of our business strategy:

• Optimize and Grow Our Pharmaceutical Distribution and Strategic Global Sourcing Businesses.

We believe we are well positioned in size and market breadth to continue to grow our distribution businesses as we invest to improve our operating and capital efficiencies.

Distribution, including specialty pharmaceuticals, anchors our growth and position in the pharmaceutical supply channel as we provide superior distribution services and deliver value-added solutions, which improve the efficiency and competitiveness of both healthcare providers and pharmaceutical manufacturers, thus allowing the pharmaceutical supply channel to better deliver healthcare to patients.

Our business strategy is focused on the global pharmaceutical supply channel where we provide distribution and value-added services to healthcare providers (primarily pharmacies, health systems, medical and dialysis clinics, physicians, and veterinarians) and pharmaceutical manufacturers to improve channel efficiencies and patient outcomes.

Our strategy is one of driving executional excellence in our core distributions solutions business in the U.S.

and Internationally, while also investing in higher margin, high growth adjacencies where we provide solutions to pharmaceutical manufacturers to support the clinical development and commercialization of their therapies and support providers in driving efficiency and effectiveness of their operations.

Implementing this disciplined and focused strategy in a seamless and unified way has allowed us to significantly expand our business.

We are well positioned to grow revenue and increase operating income through the execution of the following key elements of our business strategy:

• Optimize and Grow U.S.

Healthcare Solutions Businesses.

We are well positioned in size and market breadth to continue to grow our U.S.

Healthcare Solutions businesses as we invest to improve our operating and capital efficiencies.

human health distribution businesses, including specialty pharmaceuticals, anchors our growth and position in the pharmaceutical supply channel as we provide superior distribution services and deliver value-added solutions, which improve the efficiency and competitiveness of both healthcare providers and pharmaceutical manufacturers, thus allowing the pharmaceutical supply channel to better deliver healthcare to patients.

We are a leader in distribution and services to community oncologists and have leading positions in other physician-administered products.

We distribute plasma and other blood products, injectable pharmaceuticals, vaccines, and other specialty products.

We are well positioned to service and support many of the new biotechnology therapies that are expected to be coming to market in the near future.

We are well positioned to service and support biotechnology therapies, including biosimilars, expected to be coming to market in the near future.

We have introduced strategies to enhance our position in the generic marketplace, including our generic product private label program based in Ireland.

We source generics globally, offer a value-added generic formulary program to our healthcare provider customers, and monitor our customers' compliance with our generics program.

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provide data and other valuable services to our manufacturer customers, which includes our international presence in Switzerland where we lead our global manufacturer relations and commercialization strategy.

We also provide data and other valuable services to our manufacturer customers.

We offer value-added services and solutions to assist healthcare providers and pharmaceutical manufacturers to improve their efficiency and their patient outcomes.

Services for manufacturers include:

assistance with rapid new product launches, promotional and marketing services to accelerate product sales, product data reporting, and logistical support.

assistance with rapid new

product launches, promotional and marketing services to accelerate product sales, product data reporting, market access and health economics consulting, patient support programs, and logistical support.

Our provider solutions include:

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and packaging solutions for institutional and retail healthcare providers.

We also offer services that optimize patient access and provide purchasing power to providers.

We believe we have one of the lowest operating cost structures among all pharmaceutical distributors.

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We continue to seek opportunities to achieve increased productivity and operating income gains as we invest in and continue to implement warehouse automation technology, adopt "best practices" in warehousing activities, and increase operating leverage by increasing volume per full-service distribution facility.

We continue to seek opportunities to expand our offerings in our Pharmaceutical Distribution and Strategic Global Sourcing businesses.

• Optimize and Grow Our Global Commercialization Services and Animal Health Businesses.

We continue to seek opportunities to expand our offerings in our human health distribution businesses.

Our animal health business sells pharmaceuticals, vaccines, parasiticides, diagnostics, micro feed ingredients, and various other products to customers in both the companion animal and production animal markets.

It also offers its customers a variety of value-added services, including its e-commerce platform, technology management systems, pharmacy fulfillment, inventory management system, equipment procurement consultation, special order fulfillment, and educational seminars, which we believe closely integrate the animal health business with its customers' day-to-day operations and provide them with meaningful incentives to remain customers.

Our consulting service businesses help global pharmaceutical and biotechnology manufacturers commercialize their products.

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We also provide outcomes research, contract field staffing, patient assistance and copay assistance programs, adherence programs, risk mitigation services, and other market access programs to pharmaceutical companies.

World Courier is a leading global specialty transportation and logistics provider for the biopharmaceutical industry.

World Courier further strengthens our service offerings to global pharmaceutical manufacturers and provides an established platform for the introduction of our specialty services outside North America.

MWI Animal Health (“MWI”) sells pharmaceuticals, vaccines, parasiticides, diagnostics, micro feed ingredients, and various other products to customers in both the companion animal and production animal markets.

MWI also offers its customers a variety of value-added services, including its e-commerce platform, technology management systems, pharmacy fulfillment, inventory management system, equipment procurement consultation, special order fulfillment, and educational seminars, which we believe closely integrate MWI with its customers' day-to-day operations and provide them with meaningful incentives to continue doing business with MWI.

We continue to seek opportunities to expand our offerings in our Global Commercialization Services and Animal Health businesses.

• Optimize and Grow Our International Healthcare Solutions Businesses.

We are well positioned in size and market breadth to continue to grow our International Healthcare Solutions businesses as we invest to improve our operating and capital efficiencies.

The International Healthcare Solutions reportable segment consists of businesses that focus on international pharmaceutical wholesale and related service operations and global commercialization services.

The International Healthcare Solutions reportable segment distributes pharmaceuticals, other healthcare products, and related services to healthcare providers, including pharmacies, doctors, health centers and hospitals primarily in Europe.

It also is a leading global specialty transportation and logistics provider for the biopharmaceutical industry.

The Canada business drives innovative partnerships with manufacturers, providers, and pharmacies to improve product access and efficiency throughout the healthcare supply chain.

• Acquisitions.

In order to grow our core strategic offerings and to enter related markets, we have acquired and invested in businesses and will continue to consider additional acquisitions and investments.

On June 1, 2021, we acquired a majority of Walgreens Boots Alliance, Inc.'s ("WBA") Alliance Healthcare businesses ("Alliance Healthcare").

Alliance Healthcare supplies pharmaceuticals, other healthcare products, and related services to healthcare providers, including pharmacies, doctors, health centers, and hospitals in 10 countries, primarily in Europe.

The acquisition expands our reach and solutions in pharmaceutical distribution and adds to our depth and breadth of global manufacturer services.

For the allocation of the purchase price, see Note 2 of the Notes to Consolidated Financial Statements.

In September 2022, we entered into a definitive agreement to acquire PharmaLex Holding GmbH (“PharmaLex”), a leading provider of specialized services for the life sciences industry, for €1.28 billion in cash, subject to customary adjustments.

PharmaLex's services include regulatory affairs, development consulting and scientific affairs, pharmacovigilance, and quality management and compliance.

The acquisition will advance our role as a partner of choice for biopharmaceutical manufacturers by enhancing our global portfolio of solutions to support manufacturer partners across the pharmaceutical development and commercialization journey.

PharmaLex will be a component of our International Healthcare Solutions reportable segment.

The acquisition is expected to close by March 2023 and is subject to the satisfaction of customary closing conditions, including receipt of required regulatory approvals.

• Divestitures.

In order to allow us to concentrate on our strategic focus areas, we have divested certain non-core businesses and may, from time to time, consider additional divestitures.

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We recently entered into agreements to sell two non-core subsidiaries.

In connection with entering into these agreements, we concluded that both disposal groups met the held for sale criteria and classified their assets and liabilities as held for sale as of September 30, 2021.

Refer to Note 2 of the Notes to Consolidated Financial Statements for a summary of the assets and liabilities classified as held for sale.

We completed the sales of non-core subsidiaries in the fiscal year ended September 30, 2022 and received total proceeds $272.6 million, subject to final working capital adjustments.

Operating Structure.

We are organized based upon the products and services we provide to our customers.

Our operations as of September 30, 2021 are comprised of the Pharmaceutical Distribution Services reportable segment and other operating segments that are not significant enough to require separate reportable segment disclosure, and, therefore, have been included in Other for the purpose of reportable segment presentation.

Pharmaceutical Distribution Services Segment

Servicing healthcare providers in the pharmaceutical supply channel, the Pharmaceutical Distribution Services segment's operations provide drug distribution, strategic global sourcing, and related services designed to reduce healthcare costs and improve patient outcomes.

The Pharmaceutical Distribution Services reportable segment distributes a comprehensive offering of brand-name, specialty brand-name and generic pharmaceuticals, over-the-counter healthcare products, home healthcare supplies and equipment, and related services to a wide variety of healthcare providers, including acute care hospitals and health systems, independent and chain retail pharmacies, mail order pharmacies, medical clinics, long-term care and alternate site pharmacies, and other customers.

Through a number of operating businesses, the Pharmaceutical Distribution Services reportable segment provides pharmaceutical distribution (including plasma and other blood products, injectable pharmaceuticals, vaccines, and other specialty pharmaceutical products) and additional services to physicians who specialize in a variety of disease states, especially oncology, and to other healthcare providers, including hospitals and dialysis clinics.

Additionally, the Pharmaceutical Distribution Services reportable segment provides data analytics, outcomes research, and additional services for biotechnology and pharmaceutical manufacturers.

The Pharmaceutical Distribution Services reportable segment also provides pharmacy management, staffing and additional consulting services, and supply management software to a variety of retail and institutional healthcare providers.

We are organized geographically based upon the products and services we provide to our customers.

Our operations are comprised of two reportable segments:

Healthcare Solutions and International Healthcare Solutions.

Healthcare Solutions consists of the legacy Pharmaceutical Distribution Services reportable segment (excluding Profarma), MWI Animal Health, Xcenda, Lash Group, and ICS 3PL.

International Healthcare Solutions consists of Alliance Healthcare, World Courier, Innomar, Profarma, and Profarma Specialty (until it was divested in June 2022).

Profarma had previously been included in the Pharmaceutical Distribution Services reportable segment.

Healthcare Solutions Segment

Healthcare Solutions reportable segment distributes a comprehensive offering of brand-name, specialty brand-name and generic pharmaceuticals, over-the-counter healthcare products, home healthcare supplies and equipment, and related services to a wide variety of healthcare providers, including acute care hospitals and health systems, independent and chain retail pharmacies, mail order pharmacies, medical clinics, long-term care and alternate site pharmacies, and other customers.

Healthcare Solutions reportable segment also provides pharmaceutical distribution (including plasma and other blood products, injectable pharmaceuticals, vaccines, and other specialty pharmaceutical products) and additional services to physicians who specialize in a variety of disease states, especially oncology, and to other healthcare providers, including hospitals and dialysis clinics.

Additionally, the U.S.

Healthcare Solutions reportable segment provides data analytics, outcomes research, and additional services for biotechnology and pharmaceutical manufacturers.

Healthcare Solutions reportable segment also provides pharmacy management, staffing and additional consulting services, and supply management software to a variety of retail and institutional healthcare providers.

It also provides a full suite of integrated manufacturer services that ranges from clinical trial support to product post-approval and commercialization support.

Additionally, it delivers packaging solutions to institutional and retail healthcare providers.

Other consists of operating segments that focus on global commercialization services, animal health (MWI Animal Health), and international pharmaceutical wholesale and related service operations (Alliance Healthcare).

The operating segments that focus on global commercialization services include AmerisourceBergen Consulting Services ("ABCS") and World Courier.

MWI is a leading animal health distribution company in the United States and in the United Kingdom.

MWI sells pharmaceuticals, vaccines, parasiticides, diagnostics, micro feed ingredients, and various other products to customers in both the companion animal and production animal markets.

Additionally, MWI offers demand-creating sales force services to manufacturers.

ABCS, through a number of operating businesses, provides a full suite of integrated manufacturer services that range from clinical trial support to product post-approval and commercialization support.

World Courier, which operates in more than 50 countries, is a leading global specialty transportation and logistics provider for the biopharmaceutical industry.

Through its animal health business, the U.S.

Healthcare Solutions reportable segment sells pharmaceuticals, vaccines, parasiticides, diagnostics, micro feed ingredients, and various other products to customers in both the companion animal and production animal markets.

Our animal health business also offers demand-creating sales force services to manufacturers.

International Healthcare Solutions

It also is a leading global specialty transportation and logistics provider for the biopharmaceutical industry.

In Canada, the business drives innovative partnerships with manufacturers, providers, and pharmacies to improve product access and efficiency throughout the healthcare supply chain.

Sales and Marketing .

The majority of Pharmaceutical Distribution Services’ sales force is led nationally, with geographic focus and specialized by either healthcare provider type or size.

The majority of U.S.

Healthcare Solutions' sales force is led nationally, with geographic focus and specialized by either healthcare provider type or size.

Customer service representatives are centralized in order to respond to customer needs in a timely and effective manner.

Pharmaceutical Distribution Services also has support professionals focused on its various technologies and service offerings.

Pharmaceutical Distribution Services’ sales teams also serve national account customers through close coordination with local distribution centers and ensure that our customers are receiving service offerings that meet their needs.

Our other operating segments each have independent sales forces that specialize in their respective product and service offerings.

Healthcare Solutions also has support professionals focused on its various technologies and service offerings.

Healthcare Solutions' sales teams also serve national account customers through close coordination with local distribution centers and ensure that our customers are receiving service offerings that meet their needs.

Our International Healthcare Solutions' businesses each have independent sales forces that specialize in their respective product and service offerings.

In addition, we have an enterprise-wide marketing team that coordinates branding and all other marketing activities across the Company.

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We are typically the primary source of supply for our healthcare provider customers.

Our manufacturer customers include branded,

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generic, and biotechnology manufacturers of prescription pharmaceuticals, as well as over-the-counter product and health and beauty aid manufacturers.

Our manufacturer customers include branded, generic, and biotechnology manufacturers of prescription pharmaceuticals, as well as over-the-counter product and health and beauty aid manufacturers.

In addition, we offer a broad range of value-added solutions designed to enhance the operating efficiencies and competitive positions of our customers, thereby allowing them to improve the delivery of healthcare to patients and consumers.

Our two largest customers, WBA and Express Scripts, Inc.

Our two largest customers, Walgreens Boots Alliance, Inc.

("WBA") and Express Scripts, Inc.

("Express Scripts"), accounted for approximately 27% a nd approximately 13% , respectively, of revenue in the fiscal year ended September 30, 2022.

Our top 10 customers, including governmental agencies and group purchasing organizations ("GPO"), represented approximately 69% of revenue in the fiscal year ended September 30, 2021.

Our top 10 customers, including governmental agencies and group purchasing organizations ("GPO"), represented

approximately 66% of revenue in the fiscal year ended September 30, 2022.

The loss of any major customer or GPO relationship could adversely affect future revenue and results of operations.

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Information Systems .

The Pharmaceutical Distribution Services operating segment’s distribution facilities in the United States operate under a single enterprise resource planning (“ERP”) system.

Pharmaceutical Distribution Services’ ERP system provides for, among other things, electronic order entry by customers, invoice preparation and purchasing, and inventory tracking.

Our other operating segments operate the majority of their businesses on their own common operating systems resulting in the ability to rapidly deploy new capabilities.

We continue to make investments to enhance and upgrade the operating systems utilized by our other operating segments, including, but not limited to, Alliance Healthcare.

Healthcare Solutions operating segment’s distribution facilities in the United States primarily operate under a single enterprise resource planning (“ERP”) system.

Healthcare Solutions’ ERP system provides for, among other things, electronic order entry by customers, invoice preparation and purchasing, and inventory tracking.

Our International Healthcare Solutions operating segment operates the majority of its businesses on their own operating systems.

We continue to make investments to enhance and upgrade the operating systems utilized by our International Healthcare Solutions operating segments, including, but not limited to, Alliance Healthcare.

We also continue to invest in cybersecurity capabilities as a key priority.

Additionally, we are improving our entity-wide infrastructure environment to drive efficiency, capabilities, and speed to market.

We will continue to invest in advanced information systems and automated warehouse technology.

For example, in an effort to comply with future pedigree and other supply chain custody requirements (see Risk Factor - Increasing governmental efforts to regulate the pharmaceutical supply channel and pharmaceutical compounding may increase our costs and reduce our profitability) , we expect to continue to make significant investments in our secure supply chain information systems.

Pharmaceutical Distribution Services has made significant investments in its electronic ordering systems.

Pharmaceutical Distribution Services’ systems are intended to strengthen customer relationships by helping customers to reduce operating costs, and by providing them a platform for a number of basic and value-added services, including product demand data, inventory replenishment, single-source billing, third-party claims processing, real-time price and incentive updates, and price labels.

Pharmaceutical Distribution Services processes a substantial portion of its purchase orders, invoices, and payments electronically, and it continues to make substantial investments to expand its electronic interface with its suppliers.

Pharmaceutical Distribution Services has warehouse operating systems, which are used to manage the majority of its transactional volume.

The warehouse operating systems have improved Pharmaceutical Distribution Services’ productivity and operating leverage.

Our data center operations are insourced.

For example, in an effort to comply with future pedigree and other supply chain custody requirements (see Risk Factor - Increasing governmental efforts to regulate the pharmaceutical supply channel may increase our costs and reduce our profitability) , we expect to continue to make significant investments in our secure supply chain information systems.

Healthcare Solutions has made significant investments in its electronic ordering systems.

Healthcare Solutions’ systems are intended to strengthen customer relationships by helping customers to reduce operating costs, and by providing them a platform for a number of basic and value-added services, including product demand data, inventory replenishment, single-source billing, third-party claims processing, real-time price and incentive updates, and price labels.

Healthcare Solutions processes a substantial portion of its purchase orders, invoices, and payments electronically, and it continues to make substantial investments to expand its electronic interface with its suppliers.

Healthcare Solutions has warehouse operating systems, which are used to manage the majority of its transactional volume.

The warehouse operating systems have improved U.S.

Healthcare Solutions’ productivity and operating leverage.

We face a highly competitive global environment in the distribution of pharmaceuticals and related healthcare services.

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("Cardinal"), and UPS Logistics, among others.

Pharmaceutical Distribution Services competes with both McKesson and Cardinal, as well as national generic distributors and regional distributors within pharmaceutical distribution.

human health distribution businesses compete with both McKesson and Cardinal, as well as national generic distributors and regional distributors within pharmaceutical distribution.

In addition, we compete with manufacturers who sell directly to customers, chain drugstores who manage their own warehousing, specialty distributors, and packaging and healthcare technology companies.

ABCS, World Courier, MWI, and Alliance Healthcare also face competition from a variety of businesses.

Our consulting businesses, World Courier, MWI, and Alliance Healthcare also face competition from a variety of businesses.

In all areas, competitive factors include price, product offerings, value-added service programs, service and delivery, credit terms, and customer support.

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Intellectual Property

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We generally seek to protect such intellectual property through a combination of trade secret, patent and copyright laws, and through confidentiality and other contractually imposed protections.

We hold patents and have patent applications pending that relate to certain of our products, particularly our automated pharmacy dispensing equipment, our medication and supply dispensing equipment, certain warehousing equipment, and some of our proprietary packaging solutions.

of our proprietary packaging solutions.

We seek patent protection for our proprietary intellectual property from time to time as appropriate.

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Human Capital Resources

Our ability to be successful in the global marketplace directly depends on attracting and retaining a talented and skilled workforce.

As the strength of our workforce is critical to our success, we aspire to create healthier futures and accelerate business results by inspiring the best and brightest global talent across all dimensions of diversity to perform at their full potential.

Our ability to succeed in the global marketplace directly depends on attracting and retaining a talented and skilled workforce.

We aspire to accelerate business results by fostering a diverse and an inclusive workplace, where all members of our global talent are supported and inspired to perform at their full potential and contribute to our success as their authentic selves.

As of September 30, 2022, we had approximately 44,000 employees, of which approximately 39,000 were full-time employees and approximately 39% were U.S.-based employees.

Approximately 27% of our employees are covered by collective bargaining agreements, a large majority of which are Alliance Healthcare employees located outside of the United States.

Approximately 28% of our employees are covered by collective bargaining agreements, nearly all of whom are employees located outside of the United States.

We encourage and embrace different cultures and backgrounds, as we recognize the value of employing a workforce of unique and varying viewpoints and experiences.

Individuals who self-identify as female make up the majority of AmerisourceBergen’s global workforce and Executive Management Committee, at 51% and 57%, respectively.

Additionally, 50% of our U.S.

workforce are individuals who self-identify as ethnically and/or racially diverse.

We currently have two directors who self-identify as ethnically and/or racially diverse, and we currently have three directors who self-identify as female.

In addition, the Company announced the election of a new female director, effective January 1, 2023.

Talent Development

We consider employee development to be a strategic priority.

We support employee growth and development by offering a variety of benefits including:

We support employee growth and advancement by offering a variety of benefits to eligible full-time employees including, among others:

• Leadership and professional development programs and resources;

• Leadership and executive coaching;

• Tuition reimbursement;

• Opportunities to volunteer and participate in mentorship programs and Employee Resource Groups;

• Opportunities to volunteer and participate in mentorship and support programs such as our Employee Resource Groups (“ERGs”);

• Recognition for excellence, such as our annual Pursuit of Purpose awards and True Blue associate recognition program;

• Personalized learning and skill building experiences through a global learning experience platform.

Importantly, we have also made thoughtful investments to build our talent and culture.

In fiscal 2020, we partnered with leaders across the Company to create a new integrated talent framework aligned to our business strategy and purpose, and in fiscal 2021, we introduced to our global team members this new framework, which includes a new leadership competency model, enterprise learning strategy, and modern approach to performance management.

We introduced our new leadership model, which emphasizes people, collaboration, innovation, and purpose, to our team members in fiscal 2021 through a series of experiential learning programs.

Implementation started with our top 300 leaders and we are working to embed it into our hiring, performance management, development, and succession-planning processes.

The ultimate goal of the new leadership model is to help us unlock the full potential of our people and build the new skills and behaviors we need to achieve our enterprise strategy.

Our goal is to provide our team members with clear pathways for career development, access to programs and benefits that allow them to live fuller, healthier lives, and an ability to participate in the community in ways that inspire and celebrate individuality.

Our talent development programs are designed to help provide a supportive and engaging work environment where team members can excel, while remaining authentic and empowered to share their unique perspectives.

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Diversity, Equity, and Inclusion ("DE&I")

At AmerisourceBergen, we strive to foster a global workplace that values varying cultural, experiential, and philosophical perspectives, creates pathways for every team member to thrive, makes a positive impact on our communities through equitable access to healthcare, and is transparent and accountable for progress.

We encourage and embrace different cultures and backgrounds, as we recognize the value of employing a workforce of unique and varying viewpoints and experiences.

Currently, 49% of our U.S.

workforce are individuals with ethnically and/or racially diverse backgrounds and 57% are women.

We have one ethnically and/or racially diverse Director, and women account for 30% of our Board of Directors and 57% of our Executive Management Committee.

Our long-term DE&I strategy is focused on four critical dimensions—people, culture, progress, and community—and is grounded in deep organizational insights, our people data, and industry research and benchmarks.

• Personalized learning and skill-building programs offered through our global learning experience platform.

Importantly, we continue to make meaningful investments in supporting and building our talent and enhancing our culture.

In fiscal 2022, we conducted an Employee Experience survey across the Company as a means to gauge employee satisfaction and identify areas in which we can enhance and improve employee experience.

This survey also included a Global Inclusion Index that was comprised of questions designed to measure inclusion across the organization.

The Employee Experience Survey is the foundation for our new employee listening strategy to ensure employee voices are heard and valued in shaping our Company’s culture.

We introduced our leadership model, which emphasizes people, collaboration, innovation, and purpose, to our team members in fiscal 2021 through a series of experiential learning programs.

In fiscal year 2022, we continued to embed the Leadership Competency Model into our enterprise learning programs, talent processes, succession planning and leadership development.

The ultimate goal of our leadership competency model is to help us unlock the full potential of our people and build the new skills and behaviors we need to achieve our enterprise strategy.

Our overarching goal is to provide our team members with clear pathways for career development, access to programs and benefits that allow them to live fuller, healthier lives, and opportunities to participate in their communities in ways that are meaningful to them and inspire and celebrate their individuality.

Diversity, Equity, and Inclusion (“DEI”)

At AmerisourceBergen, we are committed to fostering a global workplace that values diversity, equity, and inclusion by creating pathways for every team member to thrive, making a positive impact on our communities, and continuously enhancing our transparency and accountability.

Our long-term DEI strategy is focused on four critical dimensions—people, culture, progress, and community—and is grounded in deep organizational insights, our people data, and industry research and benchmarks.

In pursuit of this strategy, in 2022, we:

• Introduced AmerisourceBergen’s Global Diversity & Inclusion Council, representing central leadership and driving force accelerating business results through our global diversity & inclusion strategy.

• Launched the ABility Employee Resource Group ("ERG") with the mission to elevate employee voices, bring enterprise-wide awareness, and become a resource for all individuals and their families with visible and invisible disabilities.

• Furthered our focus on supplier diversity by partnering with businesses with diverse ownership in sectors that we rely on.

• Supported equitable access to COVID-19 vaccines through our Good Neighbor Pharmacy partners, including our partnership with the Federal Retail Pharmacy Program to support vaccination efforts across the U.S., and delivered vaccines in more than 30 countries around the world.

• Directed meaningful dollars, through both the Company and the AmerisourceBergen Foundation, to philanthropic causes that benefit diverse communities, including $700 thousand to the Boys & Girls Clubs of America to address vaccine hesitancy in diverse communities, along with nearly $2.7 million of in-kind donations of healthcare products to underserved communities across the globe in conjunction with our non-profit partners.

• Doubled investment in team member development and launched new enterprise learning strategy and digital learning platform.

In addition to the foregoing, we offer the following DE&I programs and initiatives:

• To connect and align our diverse workforce, our ERG program includes eight ERGs, comprised of approximately 4,000 members globally.

The ERGs continue to evolve, as leaders and members help to enhance workforce engagement, support the local communities in which we live and work, and provide career development opportunities for our global team members.

• We follow six competencies to accelerate growth through talent and culture.

This model leads with "People Forward," which focuses on the "employee experience," as we continue to build our diverse, equitable, and inclusive workplace.

We are proud that our DE&I efforts continue to be recognized.

The Human Rights Campaign awarded the Company a perfect score of 100 percent on its Corporate Equality Index for the third consecutive year.

We were also listed as one of the "Best Places to Work for LGBT Equality." DiversityInc deemed us a "Noteworthy Company," and we ranked eighth on DiversityInc’s "Top Companies for Philanthropy."

We aim to grow, learn, and shape our approach to DE&I for the betterment of our workforce and the communities we serve.

To that end, our Board of Directors continues to believe that DE&I is an important cornerstone of our culture and competitive advantage and, through its Governance, Sustainability & Corporate Responsibility Committee, plans to continue monitoring our DE&I practices and performance.

• Refreshed the membership and mission of AmerisourceBergen’s DEI Global Council (the “DEI Council”) by expanding the membership of the DEI Council to include the Chair of each ERG and revising the DEI Council’s mission to specifically include identifying and amplifying areas of opportunity to advance our global diversity, equity, and inclusion strategy.

• Published a dedicated DEI Summary Report on the Company’s website that highlights content from our Environmental, Social and Governance report, as a means to underscore our commitment to DEI, build trust and accountability through enhanced transparency, and monitor progress on our DEI goals.

• Conducted the first Employee Experience Survey to, among other things, measure inclusion in our global culture.

• Launched a Global Inclusion campaign, which includes a robust communication plan and action-oriented learning assets to empower our team members and inform inclusive leadership.

In addition to the foregoing, we offered a number of DEI programs and initiatives in fiscal 2022, including celebrating global inclusion in partnership with our ERGs by holding two global events:

International Women’s Day in March and Pride Month in June.

We are proud that our DEI efforts continue to be recognized.

The Human Rights Campaign awarded the Company a perfect score of 100% on its Corporate Equality Index for the fifth consecutive year and also listed us as one of the “Best Places to Work for LGBTQ+ Equality.”

Competitive Compensation and Benefits

We offer all full-time team members a comprehensive benefit and compensation package, which includes:

• Medical, dental, and vision care, life insurance and other income protection, a retirement plan with Company match, and a discount employee stock purchase program;

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• An employee assistance program with free counseling sessions and unlimited digital mental health support, tuition assistance (including scholarships for dependents), medical coverage for same and opposite gender domestic partners, holidays, and paid time off;

We are committed to ensuring equal opportunity and pay equity.

We have implemented processes that are designed to drive equitable pay decisions and eliminate unexplained pay inequities.

To further support this, AmerisourceBergen has a cross-functional team of leaders from the Global Compensation, Legal, and Human Resource departments that is responsible for researching best practices, reviewing pay practices, working with external resources to analyze current pay equity, and working with senior leaders to implement changes.

As a result of these efforts, we have:

• Modified promotional salary increase guidelines to help eliminate pay gaps;

• Removed questions about pay history in the recruiting and interviewing processes of external candidates;

• Adopted the practices of administering annual merit increases based on both performance and base pay within the pay range and making promotional salary increases based on market competitiveness and internal equity;

• Implemented annual assessments that identify potential pay gaps, with the goal of developing a plan to correct any identified pay gaps that are inexplicable.

Our comprehensive benefit and compensation package offers the following to all eligible full-time team members:

• Medical, dental, and vision care, life insurance and other income protection, a retirement plan with Company match, and a discounted employee stock purchase program;

• Infertility coverage and family building counseling services, as well as reimbursement for adoption expenses;

• Counseling and education guidance benefits to support the needs of team members and dependents with developmental and cognitive challenges;

• A minimum of eight weeks of paid parental leave following birth, adoption, or surrogacy for both parents.

• Effective January 1, 2023, a minimum of twelve weeks of paid parental leave following birth, adoption, or surrogacy for both parents.

We offer postpartum support and return-to-work assistance, including on-site lactation rooms and flexible work arrangements, such as flex hours.

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We also offer back-up child and elder care, plus discounts on services, such as childcare, saving for college, and tutoring.

Beginning in 2022, we will offer one week of paid caregiver leave to care for a family member who has a serious health condition.

Beginning in 2023, we will offer two weeks of paid caregiver leave to care for a family member who has a serious health condition.

We also believe it is important to invest in the health and wellness of our team members.

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We also offer diabetes, weight management, and musculoskeletal programs for team members and their dependents.

To help team members navigate the often-confusing healthcare system, we provide a navigation and advocacy service to assist in finding the right care, obtaining a medical second opinion, and dealing with confusing medical bills.

In fiscal 2022, when we initiated our return-to-office protocol, we adopted WorkSmart, a principled work-from-home flexibility program for those team members whose work does not require them to be at one of our physical locations.

WorkSmart is based our philosophy and approach to employee satisfaction and provides team members flexibility in how and where work is completed.

Safety and COVID-19

We are focused on the safety and wellbeing of our team members.

We are committed to the safety and wellbeing of our team members.

In addition to utilizing a peer-to-peer safety program, we regularly convene our company leaders to review and evaluate safety data and issue operational excellence scorecards.

Distribution center team members receive training on proper safety procedures and incentive opportunities, with safety performance tracked and shared across the organization.

In connection with prioritizing safety, we have also implemented numerous safety precautions in response to the ongoing COVID-19 pandemic, such as mandatory health and temperature monitoring, face coverings and social distancing requirements, supplying personal protective equipment, enhanced cleaning and access to sanitizing supplies, and remote work options where available.

As the COVID-19 pandemic continues to evolve, we plan to continue to monitor and look for ways to enhance our safety protocols.

In connection with prioritizing safety, we continue to follow clinical and regulatory guidance as it relates to the COVID-19 pandemic.

We continuously monitor guidance on COVID-19 safety and look for ways to enhance our safety protocols.

To further support our team members during the COVID-19 pandemic, we enhanced our benefit offerings (which are discussed above) to provide greater access to mental health telemedicine, additional paid time off for those needing to self-quarantine or care for a family member, and access to mindfulness videos and other wellness resources.

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The fraud and abuse laws and regulations are broad in scope and are subject to frequent and varied interpretation.

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In recent years, some states have passed or proposed laws and regulations that are intended to protect the safety of the pharmaceutical supply channel.

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At the federal level, the supply chain security legislation known as the Drug Quality and Security Act (“DQSA”) became law in 2013.

The DQSA establishes federal traceability standards requiring drugs to be labeled and tracked at the lot level, preempts state drug pedigree requirements, and requires all supply-chain stakeholders to participate in an electronic, interoperable prescription drug traceability system.

The DQSA also establishes requirements for drug wholesale distributors and third-party logistics providers, including licensing requirements applicable in states that had not previously licensed third-party logistics providers.

We expect that the FDA, and eventually all comparable state agencies, will promulgate implementing regulations governing wholesale distributor and third-party logistics providers.

To date, many states have created third-party logistics licensing categories aligned with the DQSA.

There can be no assurance that we are fully compliant with the DQSA requirements, or with additional related state regulatory and licensing requirements, and any failure to comply may result in suspension or delay of certain operations and additional costs to bring our operations into compliance.

Title II of the DQSA, known as the Drug Supply Chain Security Act (“DSCSA”), establishes federal traceability standards requiring drugs to be labeled and tracked at the lot

level, preempts state drug pedigree requirements, and requires all supply-chain stakeholders to participate in an electronic, interoperable prescription drug traceability system.

The DSCSA also establishes requirements for drug wholesale distributors and third-party logistics providers, including licensing requirements applicable in states that had not previously licensed third-party logistics providers.

The FDA, and eventually all comparable state agencies, will promulgate implementing regulations governing wholesale distributor and third-party logistics providers.

There can be no assurance that we are fully compliant with DQSA requirements, or with additional related state regulatory and licensing requirements, and any failure to comply may result in suspension or delay of certain operations and additional costs to bring our operations into compliance.

These and other requirements will continue to increase the cost of our operations.

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The costs, burdens, and/or impacts of complying with federal and state regulations could be significant and the failure to comply with any such legal requirements could have a significant impact on our results of operations and financial condition.

See "Risk Factors" beginning on page 11 for a discussion of additional legal and regulatory developments, as well as enforcement actions or other litigation that may arise out of our failure to adequately comply with applicable laws and regulations that may negatively affect our results of operations and financial condition.

See “Risk Factors” for a discussion of additional legal and regulatory developments, as well as enforcement actions or other litigation that may arise out of our failure to adequately comply with applicable laws and regulations that may negatively affect our results of operations and financial condition.

Health Information and Privacy Practices

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Some of our businesses collect, maintain, and/or access other personal information (including sensitive personal information) that is subject to federal and state laws protecting such information, in addition to the requirements of HIPAA, the HITECH Act, and the implementing regulations.

Personal information is also highly regulated in many other countries in which we operate and many of these law place restrictions on the transfer of personal information to other jurisdictions.

As such regulations continue to evolve, we must comply with applicable privacy and security requirements of these countries, including

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but not limited to those in the European Union and the United Kingdom.

Most notably certain aspects of our business are subject to the European Union's General Data Protection Regulation ("GDPR") which became effective on May 25, 2018, the UK GDPR and the UK Data Protection Act of 2018, the California Consumer Protection Act ("CCPA"), which became effective on January 1, 2020, and Brazil's new General Data Protection Law (Lei Geral de Proteção de Dados Pessoais) – Law No.

Personal information is also highly regulated in many other countries in which we operate and many of these laws place restrictions on the transfer of personal information to other jurisdictions.

As such regulations continue to evolve, we must comply with applicable privacy and security requirements of these countries, including but not limited to those in the European Union and the United Kingdom.

Most notably certain aspects of our business are subject to the European Union’s General Data Protection Regulation (“GDPR”) which became effective on May 25, 2018, the UK GDPR and the UK Data Protection Act of 2018, the California Consumer Protection Act (“CCPA”), which became effective on January 1, 2020, and Brazil’s General Data Protection Law (Lei Geral de Proteção de Dados Pessoais) – Law No.

13,709/208 (“LGPD”) which became effective in August 2020.

On November 3, 2020, the California Privacy Rights Act of 2020, which builds on the CCPA, was enacted through a ballot initiative.

Similarly, Virginia (the Virginia Consumer Data Protection Act, effective on January 1, 2023) and Colorado (the Colorado Privacy Act, with certain initial compliance required by July 1, 2023) have also enacted similarly situated data protection laws.

On November 3, 2020, the California Privacy Rights Act of

2020 (“CPRA”), which amends the CCPA and adds new privacy protections that will become effective on January 1, 2023, was enacted through a ballot initiative.

Similarly, Virginia (the Virginia Consumer Data Protection Act, effective on January 1, 2023), Colorado (the Colorado Privacy Act, effective on July 1, 2023), Connecticut (the Connecticut Data Privacy Act, effective on July 1, 2023), and Utah (the Utah Consumer Privacy Act, effective December 31, 2023) have also enacted similarly situated data protection laws.

Other states and countries continue to enact similar legislation.

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Our electronic filings with the Securities and Exchange Commission (including all Forms 10-K, 10-Q, and 8-K, and any amendments to these reports) are available free of charge through our website at investor.amerisourcebergen.com immediately after we electronically file with or furnish them to the Securities and Exchange Commission and may also be viewed using their website at www.sec.gov .

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business