Cardinal Health forecasts lower earnings ahead

Shares of Cardinal Health slipped this morning after the drug distributor said that bigger investments and lower margins from vendors would leave it short of analysts' estimates for 2006 earnings. Analysts noted that the revision comes at a time that big distributors like Cardinal have been engineering a shift in the way they make money, ending an old practice of relying on drug inflation to provide profits. The wholesalers want to move toward a fee-based system with drug manufacturers.

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