Bergen, Costco Sign $220-Million Deal

Bergen Brunswig Corp., the third-biggest U.S. drug wholesaler, said Tuesday that it signed a four-year agreement valued at $220 million to supply generic drugs to Costco Wholesale Corp.

The Orange company also will provide home health-care products to customers of Costco.com and offer backup services to Costco’s main wholesaler of brand-name drugs, McKesson HBOC.

“Generic drugs are significantly more profitable for us,” Bergen spokeswoman Donna Dolan said.

Costco Wholesale, based in Issaquah, Wash., operates an international chain of 240 warehouses that offer members lower-priced products. The warehouses are designed to help smaller businesses cut costs.

Bergen’s stock rose 40 cents a share to $18.85, a 52-week high, on the New York Stock Exchange. The shares have nearly tripled over the past year. Shares of Costco Wholesale fell 31 cents to $43.75 in Nasdaq trading.