What: After reporting fourth quarter financial results, shares in Diplomat Pharmacy (NYSE:DPLO) were tumbling 22% at 12:00 p.m. EST Tuesday.

So what: The pure-play specialty pharmacy operator reported fourth quarter sales of $986.8 million, up 61.2% year over year, and full year sales of $3.37 billion, up 52% year over year.

Revenue growth was tied to an increasingly large number of FDA approvals of specialized biologics, manufacturer drug price increases, and merger and acquisition activity.

Total prescription volume increased 14% in 2015 from a year ago and that demand, plus a shift in product mix toward more expensive medicine, accounted for $453 million of the company's top-line increase. New drug launches and manufacturer price hikes added another $103 million and $136 million to sales last year, respectively, and acquisitions accounted for $460 million of the company's top-line growth, too.

Importantly, gross margin increased to 7.8% in 2015 from 6.3% in 2014, and that led to adjusted fourth quarter and full year EPS of $0.21 and $0.75, respectively.

Now what: There's not much to dislike about Diplomat Pharmacy's performance last year, so today's sell-off stems from forward guidance that fell shy of some investors predictions and concern that payer push back on drug prices could crimp future revenue growth.

In 2016, management expects revenue of between $4.3 billion and $4.6 billion and adjusted EPS of between $0.84 and $0.89. Heading into today, industry watchers outlook was for sales of $4.45 billion and EPS of $1.

Diplomat Pharmacy's disappointing guidance could be purposefully low to account for risks to drugmakers pricing strategy.

Following last year's revelation that Turing Pharmaceuticals acquired a decades-old drug only to boost its price by 5,000%, politicians and pundits have been very critical of what many view as runaway costs for specialty drugs and as a result, some candidates are proposing policies that specifically target the high cost of medicine.

Investors shouldn't ignore regulatory risk, especially in an election year, but investors should remember that demand for value-added services at specialty pharmacies is likely to grow as baby boomers get older and require more care. Especially, in oncology wherein a number of highly complex medicines are on the horizon. Since oncology accounts for 43% of Diplomat Pharmacy's revenue and these medicines can be life-saving, volume tailwinds aren't likely to fade for the company anytime soon. 

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