Option Care Health at Jefferies Conference: Navigating Industry Challenges

On Wednesday, 19 November 2025, Option Care Health (NASDAQ:OPCH) participated in the Jefferies London Healthcare Conference 2025. The company outlined its strategic initiatives amid both opportunities and challenges. CEO John Rademacher discussed the impact of Stelara's biosimilars on the company's financial outlook while emphasizing the firm's robust growth strategy and commitment to shareholder value.

Key Takeaways

• Option Care Health anticipates a $60 million to $70 million revenue headwind in 2025 due to Stelara discount changes.
• The company raised its full-year guidance despite expected challenges.
• Growth in revenue, adjusted EBITDA, and adjusted EPS is projected for 2026.
• The advanced practitioner model is expanding market access and supporting growth.
• Option Care Health remains committed to strategic investments and share buybacks.

Financial Results

• The company expects a significant financial impact from Stelara's biosimilars, with a $60 million to $70 million headwind in 2025.
• Despite these challenges, Option Care Health reported strong Q3 performance and increased its full-year guidance.
• For 2026, the company forecasts growth in revenue, adjusted EBITDA, and adjusted EPS.
• Mid-term expectations include high single-digit top-line growth and low double-digit bottom-line growth.
• Option Care Health completed $212 million in share buybacks through Q2 2025.

Operational Updates

• Option Care Health operates over 90 pharmacies and is licensed in all 50 states, serving over 300,000 unique patients annually.
• The acute business experienced mid-teens growth, while chronic business growth is expected in the low double digits.
• A 380 basis point headwind is anticipated on chronic revenue due to Stelara's transition to biosimilars.
• The advanced practitioner model is expanding, with 34% of nursing visits now conducted in infusion suites, up from 17%.

Future Outlook

• The company aims to manage the impact of Stelara and continue business growth in 2025.
• Post-2026, the goal is to stabilize the profit pool with mid-single-digit growth on the acute side and low double-digit growth on the chronic side.
• The Inflation Reduction Act (IRA) could present opportunities as drug pricing dynamics shift.
• Capital deployment focuses on business investment, strategic M&A, and share buybacks.

Q&A Highlights

• Discussions included the impact of Stelara biosimilars on revenue and EBITDA.
• The potential influence of pharmacists on prescribing decisions for biosimilars was explored.
• The IRA's effect on drug pricing and possible benefits for Option Care Health were considered.
• The advanced practitioner model's role in growth and margin expansion was highlighted.
• The company reiterated its capital deployment priorities: business investment, M&A, and share buybacks.

Readers are encouraged to refer to the full transcript for a more detailed account of the conference call discussions.

Full transcript - Jefferies London Healthcare Conference 2025:

Brian Thinkield, Healthcare Services Analyst, Jefferies: Right. Good afternoon. Trying to wake everyone up here. Welcome again to the 2025 Jefferies Global Healthcare Conference here in London. I'm Brian Thinkield, Healthcare Services Analyst, U.S.-based Healthcare Services Analyst here at Jefferies. With us this afternoon is Option Care Health and John Rademacher, the company CEO. Option Care Health is the leading provider of infusion services in the U.S. John, thanks for doing this. Appreciate you being here.

John Rademacher, CEO, Option Care Health: My pleasure, and always great to see you. Thank you for the invite.

Brian Thinkield, Healthcare Services Analyst, Jefferies: Maybe I'll start just for the benefit of the audience. Some folks here don't know what Option Care is. What exactly do you guys do? What is infusion? Where do you play in that realm?

John Rademacher, CEO, Option Care Health: Yeah. As Brian said, we are the largest independent provider of home and alternate site infusion therapy in the United States. We are licensed in all 50 states. We operate over 90 pharmacies. These are closed-door pharmacies. We do aseptic compounding. We have a broad range of products, everything from IV antibiotics to nutrition support through some of the chronic therapies and rare endorphin diseases. A broad spectrum of products that we offer. We run the pharmacy. We have about 8,000 team members across the United States. About 4,500 of them are clinicians. That is pharmacists, pharmacy technicians, dietitians, nurses, and nurse practitioners that are part of the service model.

What we do is, for some of the patients that are in a hospital setting, we'll work with discharge planners, case managers to identify patients that are stable enough to be discharged from the hospital, but still require an infused drug as being part of their care plan. We work to transition them out of the hospital safely and effectively to their home. Then we will be able to provide nursing care as well as provide all of the products, both the therapy as well as the medical supplies, in order for us to be able to administer that care. We also operate over 170 infusion centers across the U.S., over 750 chairs that are part of that.

That allows access to patients that are out doing activities of daily living, those that have chronic conditions that are out working and trying to live their best life, and being able to receive their infusion in one of those suites overseen by one of either our nurses as a registered nurse or a nurse practitioner, depending on the model that we're operating there. We have over 300,000 unique patients on an annual basis that we serve. As I said, a broad spectrum of products that are part of our care plan in the partnership that we work with the prescribing physicians and their care teams.

Brian Thinkield, Healthcare Services Analyst, Jefferies: That's a great background on Option Care, John. Maybe as I think of kind of like the state of the union, maybe if we go there next, what's been happening at Option Care? What's been keeping you busy?

John Rademacher, CEO, Option Care Health: Yeah. You know, the market in the United States from competitive dynamics continues to change from that standpoint. When you look at the breadth of the products that we offer, when you think of an organization like Option Care Health, we're really well positioned because we can use national scale as a competitive advantage. Healthcare is still local, and you've got to win at that local level. There have been some changes within the competitive dynamics where we've had some competitors that have stepped away from servicing those acute patients in the markets. We've been able to capitalize on that and be able to be that partner of choice for those discharge planners to help them transition patients to this lower-cost setting or a more stable environment for them to receive their care.

We also continue to broaden our portfolio of products from the chronic condition standpoint, expanding and continuing to reach into limited distribution drugs and be able to be a pharmacy and a channel partner for pharma to be able to bring those products forward. A lot of things happening at a national level and what we try to do from a national scale, but really focusing around the responsiveness that's required to win at that local level and put our people in the best position to support our referral sources, whether it's the hospital health systems or whether it's prescribing physician specialists that are looking for opportunities to get their patients and their infusion event overseen by a provider like Option Care Health.

Brian Thinkield, Healthcare Services Analyst, Jefferies: That's good. John, the last time you and I did this, I played nice and did not ask about Stelara until the very end. Maybe let's flip it this time around since that's what everyone seems to be worried about. How are we thinking about Stelara today? I know you have given guidance on $60 million to $70 million of an impact for 2025. Where does that stand? What are you doing right now as it relates to your negotiation with the manufacturer?

John Rademacher, CEO, Option Care Health: Yeah. One of the products that we have within our portfolio for chronic inflammatory disease is a product that Janssen has: Stelara. We had created a very unique program with them in which we were servicing patients that had medical necessities. Those that were vulnerable, that either did not have the dexterity or had comorbidities that prevented them from self-administering the drug. We were able to work with them and really carve that out. As a couple of things are happening in the environment, one is biosimilars are being introduced against Stelara and advancing through that process, as well as Stelara was identified as being one of the products in the IRA, first tranche of drugs, the first 10, as being negotiated at CMS. That created a little bit of change within the marketplace.

Last year, about this time, Janssen had come forward and advised us that we were no longer going to enjoy the discounts that we had enjoyed historically, and we were going to have less of a discount or less of the spread on the drug. We had quantified that in early 2025 as being between $60 million and $70 million of headwind that we would be facing with the changes in the discount that we enjoyed. What we communicated at the end of the third quarter in our third quarter call is that it's patterning kind of in that level that we had expected, but probably towards the high side of the $60 million-$70 million.

As we looked at the guidance for the remainder of the year, we were confident that we would fall within that area and be able to manage through that and continue to grow the business through 2025. As we look at 2025, not only did we grow through that, but we continued to strengthen our position and raise our guidance for the full year through that aspect. As we're entering the end of the year and really starting to roll into 2026, there still are some things that we are working through to determine kind of the impact for Stelara in 2026.

That is everything from what is the patient census that we will have on service at the exit at the end of the year or as we enter into 2026, what it would be the discount that we'll negotiate with Janssen in order to acquire the product. We're also looking at the transition of patients over into the biosimilars as those start to pick up their pace. And there's different economics with the different manufacturers, as you would expect on that, as well as there is a hard push by the manufacturers of trying to move on to their next generation products for Janssen, products like Tremfya, for AbbVie, products like Skyrizi, for Takeda, products like Entyvio. We're working through all of those aspects at this point in time as we're trying to lock down our 2026 budgets as well as our 2026 guidance.

I would say we have a very productive relationship with Janssen. It's been a really good partnership. They've got a portfolio of products not only that are in market today, but in their pipeline. We have demonstrated that we have a clinical platform and capability set that is highly regarded and highly valued through that process. We are managing from that aspect as well as trying to make certain that we're as best positioned as possible to extract fair value in this transition period for them, as well as they've had to negotiate a significant reduction in the price in the negotiation from the IRA standpoint. As I sit here today, we're working aggressively to kind of lock all of those pieces down. We are working in good faith with the manufacturer and all of the manufacturers just to make certain that we're best positioned.

We're using our scale and our reach into the marketplaces as being part of the value that we feel we should extract, given the uniqueness of the patient cohort that we're serving and the vulnerability that exists for these patients that have medical necessity and really can't self-administer.

Brian Thinkield, Healthcare Services Analyst, Jefferies: John, maybe since you mentioned census and the different options that patients have with a therapy, what determines where they end up, which drug, whether it's a biosimilar, a branded Stelara, or Tremfya or Skyrizi?

John Rademacher, CEO, Option Care Health: Yeah. You know, a lot of that is at the prescribing physician level. The pharmaceutical manufacturers spend a significant amount of time detailing their drug and certainly putting forward clinical studies and other evidence that help make informed decisions on that. As you enter into some of the biosimilar and those aspects of it, our pharmacists are part of the care team. They can help influence what's the best path and what's the best clinical match on that. We're always looking for the best outcome for the patient first, and we'll work in partnership on that. You see in some of the more mature products, in many instances, we may get an unbranded script that just is for an infliximab or a product of that nature.

It is really for our pharmacists that are trained in this to help best match the product with the need of the patient through that process. I'd say we have an opportunity to help to influence and inform. Ultimately, it is the prescribing physician that is writing the script. The only difference and the nuance on that is where it is our advanced practitioner model, our nurse practitioners are making those choices.

Brian Thinkield, Healthcare Services Analyst, Jefferies: That makes sense. Maybe last question of this, as we think about post-2026, would you say that once pricing or margins reset next year, that this profit pool stabilizes for you guys and that this is an issue that we can put behind us?

John Rademacher, CEO, Option Care Health: That is not only the goal, but yeah, that is what we believe is we're continuing to right-size that in alignment with some of these different market dynamics that are there. As we move into 2026, what you find is both with the biosimilar introduction as those come into the market, you start to get to an equilibrium of where the competitive forces will kind of drive to that. We expect that, again, we're going to feel some of that in 2026 with that next step down. As we get through 2026, you and I are not going to be sitting on stage talking about this product next year at this time, Brian. I promise you that.

Brian Thinkield, Healthcare Services Analyst, Jefferies: Since that's the case, I'll take one last question on Stelara since this is my last shot at it. If I'm thinking of where things stand today, I know you're in negotiations with Janssen, and I won't push you on where that stands. When we think of the IRA pricing change that's going to happen, in a status quo environment on your margins without changing through the negotiations, I mean, is that the right way to figure out the math and what the headwind could look like worst case?

John Rademacher, CEO, Option Care Health: Yeah. I mean, the unique situation that we found ourselves in with Stelara is, again, this is kind of the first entry of the IRA. You also had, in some ways for us, a really unique, I guess, discount profile that there are no other of our branded drugs have the same profile as what we enjoyed with Stelara. I think that as we move forward, the IRA is certainly going to put some, I guess, bookends on some of the cost of drugs. The next tranche, there is nothing in the next tranche of drugs that is a meaningful drug within our portfolio. The only one that's near to us, Brian, is Keytruda, but we don't do a lot of that today.

We think in some instances that may create opportunities for us as the economics start to shift and as the prescribers and those that are providing the services are looking at a different economic model moving forward. What we found with products like Remicade when it was first introduced into the marketplace is a lot of that was done in the physician practices. As it moved into a biosimilar stat and the economics started to shift, that moved into these lower-cost settings of care and for organizations like Option Care Health that are very efficient and effective in being able to provide administration of those infusions. I think there will be opportunities that get created on this as we move forward. We certainly are keeping our finger on the pulse and trying to understand the implications.

In many instances, the Stelara was a little bit of a perfect storm, if that's the right analogy, in the sense of you had not only an IRA negotiation, but a biosimilar event that was happening in between that negotiated price and where the branded product was. We had just different economics given the uniqueness of the program that we had created there.

Brian Thinkield, Healthcare Services Analyst, Jefferies: Yeah, no, that certainly was a unique situation. Maybe we'll move away from Stelara now. As I think about your last quarter, I mean, you had a good Q3. You've had a good year, honestly, without the Stelara headwinds, right? How are you thinking about the sustainability of the growth in the core business, ex-Stelara, and parsing it out between acute and chronic therapies?

John Rademacher, CEO, Option Care Health: Yeah. Again, it was just a really great execution by the team on the acute side. This is a lot of velocity in that business in the sense of we'll get an indication from a referral source, a discharge planner that a patient is going to be discharged. We need to respond back in 60 minutes or less. Do we have the drug? Do we have the nursing? Can we take them on to service? Can we have the drug by their doorstep in 24 hours or less? That takes a lot of coordination and choreograph of our teams. They executed extremely well. Just because Quorum had started to pull back and exit from the market did not make it that it was just a given that it was coming our way. We had to really establish those relationships as well as coordinate that extremely well.

Really pleased about that. I think the mid-teens growth that you saw in the acute this year is outsized because of that transition. I think as we're looking at 2026, our belief is we're extremely well positioned. We created a lot of goodwill with those referral sources given how consistent we've been in our responsiveness, the quality of the care that we've been able to deliver, and our investments, our continued investment in this space to make certain that we're best in class in being able to move that forward. I expect you're going to see that starting to revert down from the mid-teens. Our expectations are we can continue to take share in the marketplace given the reach and frequency that we have.

If the industry is at a low single digit, our expectations are we should be probably in the mid-single digit on the acute side. On the chronic side, certainly we're going to feel some of the headwinds. We called out in the third quarter that we had a 380 basis point headwind of Stelara moving to biosimilar, only to call out the revenue aspect of that. We're going to feel some of the revenue, the top-line implications of moving to a biosimilar and/or a lower cost on that. We still believe that there are a robust number of products that are available that are part of the portfolio. We'll continue to grow through on that. I think you should probably have expectations that we'll be on the lower end of kind of our historical range in the low double digits on our chronic growth.

Across the portfolio, whether it's our IVIG portfolio or really IG in total, the rest of the chronic inflammatory, some of the areas of growth that we see in the limited distribution, all of those things, Brian, we think there's real opportunity for us to continue to be on the growth trajectory that we've seen, albeit that we'll feel a little bit of a headwind on the revenue on the chronic side because of the transition from a branded product to a biosimilar.

Brian Thinkield, Healthcare Services Analyst, Jefferies: Maybe, John, just to clarify, so on the chronic, so if revenue is decelerating a little bit there because of the biosimilar introductions, the EBITDA should not really get impacted, right?

John Rademacher, CEO, Option Care Health: What we've been calling out is there will be another step down in the Stelara.

Brian Thinkield, Healthcare Services Analyst, Jefferies: Ex-Stelara.

John Rademacher, CEO, Option Care Health: Ex-Stelara. Ex-Stelara, we should be good. I mean, in most instances on a biosimilar event, when you start from a traditional branded pharmaceutical, as it moves to a biosimilar, you'll see kind of a reduction in the reference price. What you'll see from our perspective is normally an expansion of the gross profit because, again, you've got a lower reference price, but we're able to negotiate a better rate for the discount that we're able to enjoy on that. Traditional, and we would expect the rest of the book to follow that historical pattern that we saw in which you see a favorable trend in gross profit percentage as things move to biosimilar given the competitive dynamics that exist there.

Brian Thinkield, Healthcare Services Analyst, Jefferies: John, I think when we blend all this in, right, I mean, your expectation for chronic growth, your expectation Ex-Stelara, your expectation for acute, and then whatever the Stelara impact looks like, I think in the past you've said that you still expect EBITDA to grow next year.

John Rademacher, CEO, Option Care Health: Yeah.

Brian Thinkield, Healthcare Services Analyst, Jefferies: Is that where you still believe things land?

John Rademacher, CEO, Option Care Health: Yeah. We made the comment on the third quarter, and we were really thoughtful around trying to, I guess, box it, right? Everyone wants us to give a very narrow range of outcomes. There are so many variables that we're trying to work through. What we're trying to articulate there is the strength of the business remains intact. There are a lot of other therapies that continue to move that forward. Every scenario that we're running and taking a look at that, we expect that we're going to see growth in revenue, in adjusted EBITDA, and adjusted EPS as we run into 2026. That was to really put at least some parameters around how we're seeing it because there were different scenarios where people were conjectures that we couldn't grow through it in 2026.

We wanted to alleviate any of that concern as we were really trying to size it. The other thing I'll call out, Brian, and you've followed us and certainly understand the story. We have 23 straight quarters of delivering on every commitment that we've made. When we come forward with putting forward a guidance and really articulating the business, we do that with a sense of not only our belief in delivering on the promises that we make, but also with a level of confidence in the numbers that we're putting forward. We are not going to be reckless in just putting numbers out there because people want it. We want to make certain that there are numbers that you have confidence in and that we can deliver on as we're committing for that moving forward.

It is with that same commitment as we are looking at what we do for 2026 and beyond to continue to live up to our commitments, continue to have that execution path, and really understand what are the puts and takes that are part of the business and mitigate any of those headwinds as best as we can and capitalize on opportunities that sit before us.

Brian Thinkield, Healthcare Services Analyst, Jefferies: No, that's very helpful. Maybe, John, as I think about getting past 2026 again, I know in the past you've said low double-digit EBITDA growth is kind of the goal. Once we normalize through all this and with all the tailwinds that we're thinking about, I mean, is that still where you think the business lands?

John Rademacher, CEO, Option Care Health: Yeah. I think we continue to believe that over the midterm that the business is a high single-digit top line and that given the scale that we have and the leverage that we can drive across the enterprise, that that can equate to a low double-digit bottom line. When you look at our capital deployment strategy, that our adjusted EPS would be a tick higher. We still believe in that. 2026 will probably not be at that level just given some of the headwinds that we're facing. At this point in time, we have not changed our belief as we look at where are the opportunities, where is the market demand, where you have aging populations and continue to have prevalence of disease, the utility of what we do.

Quite frankly, when you offer high-quality care at an appropriate cost in a setting in which patients want to receive it, you're on the right side of most of the conversations with the payer community, with the pharma community, with the prescribers.

Brian Thinkield, Healthcare Services Analyst, Jefferies: John, maybe shifting gears here, a little more fundamental. I know you've been pushing this advanced practitioner model. You can just walk us through the strategy there and how do you think that translates to the P&L, whether it's growth rate or margins?

John Rademacher, CEO, Option Care Health: Yeah. We look at this as part of an augmentation strategy, right? At our core, we will be a home infusion pharmacy provider. What this does is it provides us a broader access to patients in the marketplace. There is not a broad, in the United States, there is not a broad benefit for Medicare beneficiaries on Medicare fee for service. This expands access to those patients that may not have a benefit. We can utilize the advanced practitioner model, and it is treated as a physician practice through that. It expands market access. It also provides a higher level of care with a clinician who is trained as an advanced practitioner to oversee the care plan and to absolutely help construct that as we move forward. We can take on more clinical complex patients through that process.

It also allows us to expand the product portfolio because there are different classes of trades that allow for different acquisition costs of products. It expands kind of the access to the different product portfolio as we move forward that allows us to expand and to utilize this as we move ahead. We have over 170 infusion suites across the U.S. Some of them are built for purpose that are infusion clinics. We also believe that we can utilize kind of our advanced practitioner model to leverage and sweat those assets even more so as we're thinking about the operation of the overall network and utilizing those suites to either oversee patients that are being seen by the advanced practitioner or those that are being done under the practice of pharmacy, but utilizing one of our infusion suites as an alternate site of care.

We get efficiencies for our nursing capacity. We get efficiencies from our delivery model on that. We're going to continue to look to utilize those facilities to their fullest in order to drive real value. We called out, Brian, on the third quarter call, about 34% of our nursing visits were done in one of our infusion suites. That's up significantly. When we started this journey, it was about 17%. We've been building that forward, not only been growing our census, but we've also been able to leverage those facilities to serve more patients. Proud of the progress that we've made there.

Brian Thinkield, Healthcare Services Analyst, Jefferies: John, we've got a few seconds here, but maybe I'll ask the question as we think about capital deployment and balancing it between what you just mentioned, expanding the AICs and the advanced practitioner model, acquisitions, and share buybacks. I mean, how are you thinking about the remaining runway on clinic expansions and then buyback versus M&A?

John Rademacher, CEO, Option Care Health: Yeah. I mean, the cash flow of this business is spectacular. I mean, the team does a really great job of converting EBITDA to cash. And cash pays the light bills, not EBITDA. We are very focused on that. We have been clear around our capital deployment. I mean, we are investing in our business and CapEx and continue to invest in people, process, technology, and facilities to be best in class from that perspective. We have called out that we think there are meaningful and accretive deals from an M&A standpoint, but we are going to be disciplined in our approach there in making certain that it is both strategic and economic. We have demonstrated that we are willing to use our dollars to do share buyback. I mean, through the second quarter of this year, we bought back over $212 million of shares that we believe, again, brought real value to our shareholders.

I think we'll look at it in that progression, Brian, but again, love the cash flow of this business and think it creates a lot of optionality for us.

Brian Thinkield, Healthcare Services Analyst, Jefferies: That's awesome. John, thank you so much. Really appreciate your time.

John Rademacher, CEO, Option Care Health: You're welcome. Thank you, everyone, for your interest.

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