Document:

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                                                                   Exhibit 10.37

                              EMPLOYMENT AGREEMENT

            THIS AGREEMENT, dated and effective as of July 26, 2004 (the
"Effective Date"), is made and entered into by and between Cardinal Health,
Inc., an Ohio corporation (the "Company"), and J. Michael Losh (the
"Executive").

            WHEREAS, the Company and the Executive desire to set forth in a
written agreement the terms and conditions under which the Executive will render
services to the Company as interim Chief Financial Officer from and after the
Effective Date.

            NOW, THEREFORE, the parties hereto, in consideration of the mutual
covenants herein contained, and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, and intending to be
legally bound hereby, agree as follows:

            1. EMPLOYMENT PERIOD. The Company shall employ, or shall cause one
of its subsidiaries or affiliates to employ, the Executive, and the Executive
shall serve the Company, on the terms and conditions set forth in this
Agreement, during the one-year period beginning on the Effective Date and ending
on the first (1st) anniversary of the Effective Date, unless prior to such date
the employment of the Executive terminates in accordance with Section 4 of this
Agreement (such period, the "Employment Period"). This Agreement shall not
impact the Executive's continued service as a member of the Company's Board of
Directors.

            2. POSITION AND DUTIES. (a) During the Employment Period, the
Executive shall serve as the interim Chief Financial Officer of the Company,
with the duties and responsibilities customarily assigned to such position, and
such other duties and responsibilities as the Chief Executive Officer of the
Company shall from time to time assign to the Executive.

            (b) During the Employment Period, and excluding any periods of
vacation and sick leave to which the Executive is entitled under the practices
and policies of the Company as in effect from time to time, the Executive shall
devote the Executive's full business attention and time to the business and
affairs of the Company, and shall use the Executive's reasonable best efforts to
carry out such responsibilities faithfully and efficiently. It shall not be
considered a violation of the foregoing for the Executive to (A) continue to
serve on the corporate boards or committees on which he is serving as of the
Effective Date in the same capacity, in which he is serving as of the Effective
Date and, with the prior written consent of the Chief Executive Officer of the
Company, additional corporate boards or committees, (B) serve on civic or
charitable boards or committees, (C) deliver lectures, fulfill speaking
engagements or teach at educational institutions and (D) manage personal
investments, so long as such activities under clauses (C) and (D) do not
materially interfere with the performance of the Executive's responsibilities as
an employee of the Company in accordance with this Agreement.

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            (c) As of the Effective Date, the Executive's services shall be
performed primarily at the Company's corporate headquarters in Dublin, Ohio.

            3. COMPENSATION. (a) OPTION GRANT. As compensation for the
Executive's services hereunder, as of July 27, 2004, the Company shall grant the
Executive an option to purchase 210,000 common shares, without par value, of the
Company (the "Option") pursuant to the terms and conditions set forth in the
Nonqualified Stock Option Agreement attached to this Agreement as Exhibit A (the
"Option Agreement"). The exercise price per common share of the Option shall be
equal to the closing price of the common shares of the Company on the New York
Stock Exchange on July 27, 2004. The Executive acknowledges and agrees that he
will not be eligible to receive annual grants of options to purchase common
shares of the Company during the Company's fiscal 2005 year, unless any such
grant is authorized by the Human Resources and Compensation Subcommittee of the
Board of Directors of the Company. During the Employment Period, the Executive
will not be eligible to receive compensation payable solely to non-employee
directors of the Company.

            (a) EMPLOYEE BENEFITS. During the Employment Period, the Executive
shall be entitled to receive life insurance, travel accident insurance and
accidental death and disability insurance at no cost to the Executive as well as
vacation to the same extent as, and on the same terms and conditions as, other
similarly situated executives of the Company from time to time.

            (b) EXPENSES. The Executive shall be entitled to receive prompt
reimbursement for all reasonable expenses incurred by the Executive during the
Employment Period in carrying out the Executive's duties under this Agreement
(including travel and living expenses for him and his spouse in the Columbus,
Ohio living area), provided that the Executive complies with the policies,
practices and procedures of the Company then applicable to the Executive for
submission of expense reports, receipts, or similar documentation of such
expenses.

            4. EMPLOYMENT TERMINATION. The Executive or the Company may
terminate the Executive's employment during the Employment Period for any reason
upon 30 days advanced written notice to the Company or to the Executive, as
applicable (the date on which the Executive ceases to be an employee of the
Company shall be referred to as the "Date of Termination").

            5. COVENANTS. (a) INTRODUCTION. The parties acknowledge that the
provisions and covenants contained in this Section 5 are ancillary and material
to this Agreement and the Option Agreement and that the limitations contained
herein are reasonable in geographic and temporal scope and do not impose a
greater restriction or restraint than is necessary to protect the goodwill and
other legitimate business interests of the Company. The parties also acknowledge
and agree that the provisions of this Section 5 do not adversely affect the
Executive's ability to earn a living in any capacity that does not violate the
covenants contained herein. The parties further acknowledge and agree that the
provisions of Section 11(a) below are accurate and necessary because (i) this
Agreement is entered into in

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the State of Ohio, (ii) Ohio has a substantial relationship to the parties and
to this transaction, (iii) Ohio is the headquarters state of the Company, which
has operations nationwide and has a compelling interest in having its employees
treated uniformly within the United States, (iv) the use of Ohio law provides
certainty to the parties in any covenant litigation in the United States, and
(v) enforcement of the provision of this Section 5 would not violate any
fundamental public policy of Ohio or any other jurisdiction.

            (b) CONFIDENTIAL INFORMATION. The Executive shall hold in a
fiduciary capacity for the benefit of the Company and all of its subsidiaries,
partnerships, joint ventures, limited liability companies, and other affiliates
(collectively, the "Cardinal Group"), all secret or confidential information,
knowledge or data relating to the Cardinal Group and its businesses (including,
without limitation, any proprietary and not publicly available information
concerning any processes, methods, trade secrets, research, secret data, costs,
names of users or purchasers of their respective products or services, business
methods, operating procedures or programs or methods of promotion and sale) that
the Executive has obtained or obtains during the Executive's employment by the
Cardinal Group and that is not public knowledge (other than as a result of the
Executive's violation of this Section 5(b)) ("Confidential Information"). For
the purposes of this Section 5(b), information shall not be deemed to be
publicly available merely because it is embraced by general disclosures or
because individual features or combinations thereof are publicly available. The
Executive shall not communicate, divulge or disseminate Confidential Information
at any time during or after the Executive's employment with the Cardinal Group,
except with the prior written consent of the Cardinal Group, as applicable, or
as otherwise required by law or legal process. All records, files, memoranda,
reports, customer lists, drawings, plans, documents and the like that the
Executive uses, prepares or comes into contact with during the course of the
Executive's employment shall remain the sole property of the Company and/or the
Cardinal Group, as applicable, and shall be turned over to the applicable
Cardinal Group company upon termination of the Executive's employment.

            (c) NON-RECRUITMENT OF EMPLOYER'S EMPLOYEES, ETC. Executive shall
not, at any time during the Restricted Period (as defined in this Section 5(c)),
without the prior written consent of Cardinal Health, Inc., directly or
indirectly, contact, solicit, recruit, or employ (whether as an employee,
officer, director, agent, consultant or independent contractor) any person who
was or is at any time during the previous twenty four months an employee,
representative, officer or director of the Cardinal Group. Further, during the
Restricted Period, Executive shall not take any action that could reasonably be
expected to have the effect of encouraging or inducing any employee,
representative, officer or director of the Cardinal Group to cease their
relationship with the Cardinal Group for any reason. This provision does not
apply to recruitment of employees within or for the Cardinal Group. The
"Restricted Period" means the period of Executive's employment with the Cardinal
Group and the additional period that ends 24 months after the Executive's Date
of Termination.

            (d) NO COMPETITION--SOLICITATION OF BUSINESS. During the Restricted
Period, the Executive shall not (either directly or indirectly or as an officer,
agent, employee, partner

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or director of any other company, partnership or entity) solicit, service, or
accept on behalf of any competitor of the Cardinal Group the business of (i) any
customer of the Cardinal Group at the time of the Executive's employment or Date
of Termination, or (ii) potential customer of the Cardinal Group which the
Executive knew to be an identified, prospective purchaser of services or
products of the Cardinal Group.

            (e) NO COMPETITION--EMPLOYMENT BY COMPETITOR. During the Restricted
Period, the Executive shall not invest in (other than in a publicly traded
company with a maximum investment of no more than 1% of outstanding shares),
counsel, advise, or be otherwise engaged or employed by, any entity or
enterprise that competes with the Cardinal Group, by developing, manufacturing
or selling any product or service of a type, respectively, developed,
manufactured or sold by the Cardinal Group. It shall not be considered a
violation of the foregoing for the Executive to continue to serve on the
corporate boards or committees on which he is serving as of the Effective Date
and, with the prior written consent of the Chief Executive Officer of the
Company, additional corporate boards or committees.

            (f) NO DISPARAGEMENT. (i) The Executive shall at all times refrain
from taking actions or making statements, written or oral, that (A) denigrate,
disparage or defame the goodwill or reputation of the Cardinal Group or any of
its trustees, officers, security holders, partners, agents or former or current
employees and directors, or (B) are intended to, or may be reasonably expected
to, adversely affect the morale of the employees of the Cardinal Group. The
Executive further agrees not to make any negative statements to third parties
relating to the Executive's employment or any aspect of the businesses of the
Cardinal Group and not to make any statements to third parties about the
circumstances of the termination of the Executive's employment, or about the
Cardinal Group or its trustees, officers, security holders, partners, agents or
former or current employees and directors, except as may be required by a court
or governmental body.

                  (ii) The Executive further agrees that, following termination
of employment for any reason, the Executive shall assist and cooperate with the
Company with regard to any matter or project in which the Executive was involved
during the Executive's employment with the Company, including but not limited to
any litigation that may be pending or arise after such termination of
employment. Further, the Executive agrees to notify the Company at the earliest
opportunity of any contact that is made by any third parties concerning any such
matter or project. The Company shall not unreasonably request such cooperation
of Executive and shall compensate the Executive for any lost wages or expenses
associated with such cooperation and assistance.

            (g) ACKNOWLEDGMENT AND ENFORCEMENT. (i) The Executive acknowledges
and agrees that: (A) the purpose of the foregoing covenants, including without
limitation the noncompetition covenants of Sections 5(d) and (e), is to protect
the goodwill, trade secrets and other Confidential Information of the Company;
(B) because of the nature of the business in which the Cardinal Group is engaged
and because of the nature of the Confidential Information to which the Executive
has access, the Company would suffer irreparable harm

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and it would be impractical and excessively difficult to determine the actual
damages of the Cardinal Group in the event the Executive breached any of the
covenants of this Section 5; and (C) remedies at law (such as monetary damages)
for any breach of the Executive's obligations under this Section 5 would be
inadequate. The Executive therefore agrees and consents that if the Executive
commits any breach of a covenant under this Section 5 or threatens to commit any
such breach, the Company shall have the right (in addition to, and not in lieu
of, any other right or remedy that may be available to it) to temporary and
permanent injunctive relief from a court of competent jurisdiction, without
posting any bond or other security and without the necessity of proof of actual
damage.

                  (ii) In addition, in the event of a violation of this Section
5, the Company shall have the right to require the Executive to pay to the
Company all or any portion of the Clawback Amount (as defined below) within 30
days following written notice by the Company to the Executive (the "Company
Notice") that it is imposing such requirement. The "Clawback Amount" means: if
the Executive has exercised any stock options granted to the Executive by the
Cardinal Group under the Cardinal Health, Inc. Equity Incentive Plan within
three years before a violation of Section 5(b), 5(c) or 5(f) or within one year
before a violation of Section 5(d) or 5(e), an amount equal to the gross option
gain realized or obtained by the Executive or any transferee resulting from the
exercise of such stock option, measured at the date of exercise (i.e., the
difference between the fair market value of the purchased stock on the date of
exercise and the exercise price paid by the Executive therefor).

In addition to the foregoing, in the event of a violation of this Section 5, all
outstanding stock options granted to the Executive by the Cardinal Group (or any
part thereof) under the Cardinal Health, Inc. Equity Incentive Plan that have
not been exercised shall immediately and automatically terminate, be forfeited,
and cease to be exercisable at any time.

                  (iii) With respect to any provision of this Section 5 finally
determined by a court of competent jurisdiction to be unenforceable, the
Executive and the Company hereby agree that such court shall have jurisdiction
to reform this Agreement or any provision hereof so that it is enforceable to
the maximum extent permitted by law, and the parties agree to abide by such
court's determination. If any of the covenants of this Section 5 are determined
to be wholly or partially unenforceable in any jurisdiction, such determination
shall not be a bar to or in any way diminish the Company's right to enforce any
such covenant in any other jurisdiction.

            6. NON-EXCLUSIVITY OF RIGHTS. Nothing in this Agreement shall
prevent or limit the Executive's continuing or future participation in any plan,
program, policy or practice provided by the Cardinal Group for which the
Executive may qualify, nor shall anything in this Agreement limit or otherwise
affect such rights as the Executive may have under any contract or agreement
with the Cardinal Group. Vested benefits and other amounts that the Executive is
otherwise entitled to receive under any plan, policy, practice or program of, or
any contract or agreement with, the Cardinal Group on or after the Date of
Termination

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shall be payable in accordance with such plan, policy, practice, program,
contract or agreement, as the case may be, except as explicitly modified by this
Agreement.

            7. NO MITIGATION. In no event shall the Executive be obligated to
seek other employment or take any other action by way of mitigation of the
amounts payable to the Executive under any of the provisions of this Agreement
and such amounts shall not be reduced, regardless of whether the Executive
obtains other employment.

            8. NOTICES. (a) METHODS. Each notice, demand, request, consent,
report, approval or communication (hereinafter, "Notice") which is or may be
required to be given by any party to any other party in connection with this
Agreement, shall be in writing, and given by facsimile, personal delivery,
receipted delivery services, or by certified mail, return receipt requested,
prepaid and properly addressed to the party to be served as shown in Section
8(b) below.

            (b) ADDRESSES. Notices shall be effective on the date sent via
facsimile, the date delivered personally or by receipted delivery service, or
three days after the date mailed:

            If to the Company:              Cardinal Health, Inc.
                                            7000 Cardinal Place
                                            Dublin, OH  43017

                                            Attn.:  Chief Legal Officer

                                            Facsimile: (614) 757-6948

            If to the Executive:            At the Executive's residence address
                                            most recently on the books and
                                            records of the Company.

            (c) CHANGES. Each party may designate by Notice to the other in
writing, given in the foregoing manner, a new address to which any Notice may
thereafter be so given, served or sent.

            9. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement
of the parties with respect to the subject matter hereof.

            10. SUCCESSORS. (a) EXECUTIVE. This Agreement is personal to the
Executive and, without the prior written consent of the Company, shall not be
assignable by the Executive otherwise than by will or the laws of descent and
distribution. This Agreement shall inure to the benefit of and be enforceable by
the Executive's legal representatives.

            ( b) THE COMPANY. This Agreement shall inure to the benefit of and
be binding upon the Company and its successors and assigns.

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            (c) The Company may assign this Agreement to any successor (whether
direct or indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company that expressly
agrees to assume and perform this Agreement in the same manner and to the same
extent that the Company would have been required to perform it if no such
assignment had taken place. As used in this Agreement, "Company" shall mean both
the Company as defined above and any such successor that assumes and agrees to
perform this Agreement, by operation of law or otherwise.

            11. MISCELLANEOUS. (a) GOVERNING LAW. This Agreement shall be
governed by, and construed in accordance with, the laws of Ohio, without
reference to principles of conflict of laws. In addition, all legal actions or
proceedings relating to this Agreement shall be brought in state or federal
courts located in Franklin County, Ohio, and the parties executing this
Agreement hereby consent to the personal jurisdiction of such courts. This
Agreement may not be amended or modified except by a written agreement executed
by the parties hereto or their respective successors and legal representatives.

            (b) SEVERABILITY. The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement. If any provision of this Agreement shall
be held invalid or unenforceable in part, the remaining portion of such
provision, together with all other provisions of this Agreement, shall remain
valid and enforceable and continue in full force and effect to the fullest
extent consistent with law.

            (c) TAX WITHHOLDING. Notwithstanding any other provision of this
Agreement, the Company may withhold from amounts payable under this Agreement
all federal, state, local and foreign taxes that are required to be withheld by
applicable laws or regulations.

            (d) NO WAIVER. The Executive's or the Company's failure to insist
upon strict compliance with any provision of, or to assert any right under, this
Agreement shall not be deemed to be a waiver of such provision or right or of
any other provision of or right under this Agreement.

            (e) WARRANTY. The Executive hereby warrants that the Executive is
free to enter into this Agreement and to perform the services described herein.

            (f) HEADINGS. The Section headings contained in this Agreement are
for convenience only and in no manner shall be construed as part of this
Agreement.

            (g) COUNTERPARTS. This Agreement may be executed simultaneously in
two or more counterparts, each of which shall be deemed an original but all of
which together shall constitute one and the same instrument

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            (h) SURVIVAL. The obligations under this Agreement of the Executive
and the Company that by their nature and terms require (or may require)
satisfaction after the end of the Employment Period shall survive such event and
shall remain binding upon such parties.

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      IN WITNESS WHEREOF, the Executive has hereunto set his hand and, pursuant
to the authorization of the Human Resources and Compensation Subcommittee of its
Board of Directors, the Company has caused this Agreement to be executed in its
name on its behalf, all as of the day and year first above written.

                                            EXECUTIVE

                                            /s/ J. Michael Losh
                                            ------------------------------------
                                            J. Michael Losh

                                            CARDINAL HEALTH, INC.

                                            By  /s/ Robert D. Walter
                                                --------------------------------
                                                Robert D. Walter
                                                Chief Executive Officer

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                                                                     EXHIBIT A

                              CARDINAL HEALTH, INC.
                       NONQUALIFIED STOCK OPTION AGREEMENT

Grant Date:       July 27, 2004

Exercise Price:

Grant Vesting Date:  July 27, 2007

Grant Expiration Date:  July 27, 2014

Cardinal Health, Inc., an Ohio corporation (the "Company"), has granted to J.
Michael Losh ("Grantee"), an option (the "Option") to purchase 210,000 common
shares, without par value, of the Company (the "Shares") for a total purchase
price of , (i.e., the equivalent of [stock price] for each full Share). The
Option has been granted under the Cardinal Health, Inc. Amended and Restated
Equity Incentive Plan, as amended (the "Plan"), and will include and be subject
to all provisions of the Plan, which are incorporated herein by reference, and
will be subject to the provisions of this agreement. Capitalized terms used in
this agreement which are not specifically defined will have the meanings
ascribed to such terms in the Plan. Subject to the terms of this agreement, this
Option shall be exercisable at any time on or after July 27, 2007 and prior to
July 27, 2014.

By:
    ----------------------
Robert D. Walter
Chairman and CEO

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1. Method of Exercise and Payment of Price.

(a) Method of Exercise. At any time when the Option is exercisable under the
Plan and this agreement, the Option may be exercised from time to time by
written notice to the Company which will:

         (i) state the number of Shares with respect to which the Option is
being exercised; and

         (ii) if the Option is being exercised by anyone other than Grantee, be
accompanied by proof satisfactory to counsel for the Company of the right of
such person or persons to exercise the Option under the Plan and all applicable
laws and regulations.

(b) Payment of Price. The full exercise price for the Option shall be paid to
the Company as provided in the Plan.

2. Transferability. The Option shall be transferable (I) at Grantee's death, by
Grantee by will or pursuant to the laws of descent and distribution, and (II) by
Grantee during Grantee's lifetime, without payment of consideration, to (a) the
spouse, former spouse, parents, stepparents, grandparents, parents-in-law,
siblings, siblings-in-law, children, stepchildren, children-in-law,
grandchildren, nieces or nephews of Grantee, or any other persons sharing
Grantee's household (other than tenants or employees) (collectively, "Family
Members"), (b) a trust or trusts for the primary benefit of Grantee or such
Family Members, (c) a foundation in which Grantee or such Family Members control
the management of assets, or (d) a partnership in which Grantee or such Family
Members are the majority or controlling partners; provided, however, that
subsequent transfers of the transferred Option shall be prohibited, except (X)
if the transferee is an individual, at the transferee's death by the transferee
by will or pursuant to the laws of descent and distribution, and (Y) without
payment of consideration to the individuals or entities listed in subparagraphs
II(a), (b) or (c), above, with respect to the original Grantee. The Human
Resources and Compensation Committee of the Board of Directors of the Company
(the "Committee") may, in its discretion, permit transfers to other persons and
entities as permitted by the Plan. Neither a transfer under a domestic relations
order in settlement of marital property rights nor a transfer to an entity in
which more than 50% of the voting interests are owned by Grantee or Family
Members in exchange for an interest in that entity shall be considered to be a
transfer for consideration. Within 10 days of any transfer, Grantee shall notify
the Stock Option Administrator of the Company in writing of the transfer.
Following transfer, the Option shall continue to be subject to the same terms
and conditions as were applicable immediately prior to transfer and, except as
otherwise provided in the Plan or this agreement, references to the original
Grantee shall be deemed to refer to the transferee. The events of termination of
services of Grantee provided in paragraph 3 hereof shall continue to be applied
with respect to the original Grantee, following which the Option shall be
exercisable by the transferee for the periods specified in paragraph 3. The
Company shall have no obligation to notify any transferee of Grantee's
termination of

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employment with the Company for any reason. The conduct prohibited of Grantee in
paragraphs 5 and 6 hereof shall continue to be prohibited of Grantee following
transfer to the same extent as immediately prior to transfer and the Option (or
its economic value, as applicable) shall be subject to forfeiture by the
transferee and recoupment from Grantee to the same extent as would have been the
case of Grantee had the Option not been transferred. Grantee shall remain
subject to the recoupment provisions of paragraphs 5 and 6 of this agreement and
tax withholding provisions of Section 13(d) of the Plan following transfer of
the Option.

3. Termination of Relationship.

(a) Termination by Death or Disability. If Grantee's provision of services to
the Company and its subsidiaries (collectively, the "Cardinal Group") terminates
by reason of death or disability (as defined in the Plan), then, any unvested
portion of the Option shall vest upon Grantee's termination of provision of
services and become exercisable in full through the Grant Expiration Date (the
"Exercise Period"). The Option may following Grantee's death be exercised by any
transferee of Grantee, if applicable, or by the legal representative of the
estate or by the legatee of Grantee under the will of Grantee. Grantee's
services as a member of the Board of Directors of the Company will be treated as
the provision of services under this agreement.

(b) Voluntary Termination of Services Prior to the Grant Vesting Date or For
Cause. If Grantee's provision of services to the Cardinal Group terminates prior
to the Grant Vesting Date as a result of Grantee's voluntary termination of
services (subject to Section 10 of the Plan regarding acceleration of the
vesting of the Option upon a Change of Control) or terminates at any time for
Cause, the Option will automatically terminate on the date of such termination.
If the vesting of the Option is accelerated upon a Change of Control, the Option
will remain exercisable through the expiration of the Exercise Period.

(c) Other Termination of Services. If Grantee's provision of services to the
Cardinal Group terminates for any reason other than pursuant to the terminations
described in paragraphs 3(a) and (b) above, then (i) if such termination is
prior to the Grant Vesting Date, any unvested portion of the Option shall vest
upon Grantee's termination of provision services and (ii) following any such
termination of provision of services, the Option shall become exercisable in
full through the expiration of the Exercise Period. Notwithstanding the
foregoing, if Grantee dies after the Option vests but before the expiration of
the Exercise Period, the Option may be exercised by any transferee of the
Option, if applicable, or by the legal representative of the estate or by the
legatee of Grantee under the will of Grantee following Grantee's death, through
the expiration of the Exercise Period.

4. Restrictions on Exercise. The Option is subject to all restrictions in this
agreement and/or in the Plan. As a condition of any exercise of the Option, the
Company may require Grantee or his or her transferee or successor to make any
representation and

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warranty to comply with any applicable law or regulation or to confirm any
factual matters (including Grantee's compliance with the terms of paragraphs 5
and 6 of this agreement or any employment or severance agreement between any
member of the Cardinal Group and Grantee) reasonably requested by the Company.

5. Triggering Conduct/Competitor Triggering Conduct. As used in this agreement,
"Triggering Conduct" shall include disclosing or using in any capacity other
than as necessary in the performance of duties assigned by the Cardinal Group
any confidential information, trade secrets or other business sensitive
information or material concerning the Cardinal Group; violation of Company
policies, including conduct which would constitute a breach of any of the
Certificates of Compliance with Company Policies and/or the Certificates of
Compliance with Company Business Ethics Policies signed by Grantee; directly or
indirectly employing, contacting concerning employment, or participating in any
way in the recruitment for employment of (whether as an employee, officer,
director, agent, consultant or independent contractor), any person who was or is
an employee, representative, officer or director of the Cardinal Group at any
time within the 12 months prior to the termination of Grantee's provision of
services to the Cardinal Group; any action by Grantee and/or his or her
representatives that either does or could reasonably be expected to undermine,
diminish or otherwise damage the relationship between the Cardinal Group and any
of its customers, potential customers, vendors and/or suppliers that were known
to Grantee; and breaching any provision of any employment or severance agreement
with a member of the Cardinal Group. As used in this agreement, "Competitor
Triggering Conduct" shall include, either during Grantee's provision of services
or within one year following Grantee's termination of provision of services to
the Cardinal Group, accepting employment with or serving as a consultant or
advisor or in any other capacity to an entity that is in competition with the
business conducted by any member of the Cardinal Group (a "Competitor"),
including, but not limited to, employment or another business relationship with
any Competitor if Grantee has been introduced to trade secrets, confidential
information or business sensitive information during Grantee's provision of
services to the Cardinal Group and such information would aid the Competitor
because the threat of disclosure of such information is so great that, for
purposes of this agreement, it must be assumed that such disclosure would occur.

6. Special Forfeiture/Repayment Rules. For so long as Grantee continues to
provide services to the Cardinal Group and for three years following Grantee's
termination of provision of services to the Cardinal Group regardless of the
reason, Grantee agrees not to engage in Triggering Conduct. If Grantee engages
in Triggering Conduct during the time period set forth in the preceding sentence
or in Competitor Triggering Conduct during the time period referenced in the
definition of "Competitor Triggering Conduct" set forth in paragraph 5 above,
then:

(a) the Option (or any part thereof that has not been exercised) shall
immediately and automatically terminate, be forfeited, and shall cease to be
exercisable at any time; and

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(b) Grantee shall, within 30 days following written notice from the Company, pay
the Company an amount equal to the gross option gain realized or obtained by
Grantee or any transferee resulting from the exercise of such Option, measured
at the date of exercise (i.e., the difference between the market value of the
Shares underlying the Option on the exercise date and the exercise price paid
for such Shares underlying the Option), with respect to any portion of the
Option that has already been exercised at any time within three years prior to
the Triggering Conduct (the "Look-Back Period"), less $1.00. If Grantee engages
only in Competitor Triggering Conduct, then the Look-Back Period shall be
shortened to exclude any period more than one year prior to Grantee's
termination of employment with the Cardinal Group, but including any period
between the time of Grantee's termination and engagement in Competitor
Triggering Conduct. Grantee may be released from Grantee's obligations under
this paragraph 6 only if the Committee (or its duly appointed designee)
determines, in writing and in its sole discretion, that such action is in the
best interests of the Company. Nothing in this paragraph 6 constitutes a
so-called "noncompete" covenant. This paragraph 6 does, however, prohibit
certain conduct while Grantee is associated with the Cardinal Group and
thereafter and does provide for the forfeiture or repayment of the benefits
granted by this agreement under certain circumstances, including, but not
limited to, Grantee's acceptance of employment with a Competitor. Grantee agrees
to provide the Company with at least 10 days written notice prior to directly or
indirectly accepting employment with or serving as a consultant or advisor or in
any other capacity to a Competitor, and further agrees to inform any such new
employer, before accepting employment, of the terms of this paragraph 6 and
Grantee's continuing obligations contained herein. No provisions of this
agreement shall diminish, negate or otherwise impact any separate noncompete or
other agreement to which Grantee may be a party, including, but not limited to,
any of the Certificates of Compliance with Company Policies and/or the
Certificates of Compliance with Company Business Ethics Policies; provided,
however, that to the extent that any provisions contained in any other agreement
are inconsistent in any manner with the restrictions and covenants of Grantee
contained in this agreement, the provisions of this agreement shall take
precedence and such other inconsistent provisions shall be null and void.
Grantee acknowledges and agrees that the restrictions contained in this
agreement are being made for the benefit of the Company in consideration of
Grantee's receipt of the Option, in consideration of employment, in
consideration of exposing Grantee to the Company's business operations and
confidential information, and for other good and valuable consideration, the
adequacy of which consideration is hereby expressly confirmed. Grantee further
acknowledges that the receipt of the Option and execution of this agreement are
voluntary actions on the part of Grantee and that the Company is unwilling to
provide the Option to Grantee without including the restrictions and covenants
of Grantee contained in this agreement. Further, the parties agree and
acknowledge that the provisions contained in paragraphs 5 and 6 are ancillary
to, or part of, an otherwise enforceable agreement at the time the agreement is
made.

7. Governing Law/Venue. This agreement shall be governed by the laws of the
State of Ohio, without regard to principles of conflicts of law, except to the
extent superceded by the laws of the United States of America. The parties agree
and acknowledge that the

                                       5
<PAGE>

laws of the State of Ohio bear a substantial relationship to the parties and/or
this agreement and that the Option and benefits granted herein would not be
granted without the governance of this agreement by the laws of the State of
Ohio. In addition, all legal actions or proceedings relating to this agreement
shall be brought in state or federal courts located in Franklin County, Ohio and
the parties executing this agreement hereby consent to the personal jurisdiction
of such courts. Grantee acknowledges that the covenants contained in paragraphs
5 and 6 of this agreement are reasonable in nature, are fundamental for the
protection of the Company's legitimate business and proprietary interests, and
do not adversely affect Grantee's ability to earn a living in any capacity that
does not violate such covenants. The parties further agree that in the event of
any violation by Grantee of any such covenants, the Company will suffer
immediate and irreparable injury for which there is no adequate remedy at law.
In the event of any violation or attempted violations of the restrictions and
covenants of Grantee contained in this agreement, the Cardinal Group shall be
entitled to specific performance and injunctive relief or other equitable
relief, including the issuance ex parte of a temporary restraining order,
without any showing of irreparable harm or damage, such irreparable harm being
acknowledged and admitted by Grantee, and Grantee hereby waives any requirement
for the securing or posting of any bond in connection with such remedy, without
prejudice to the rights and remedies afforded the Cardinal Group hereunder or by
law. In the event that it becomes necessary for the Cardinal Group to institute
legal proceedings under this agreement, Grantee shall be responsible to the
Company for all costs and reasonable legal fees incurred by the Company with
regard to such proceedings. Any provision of this agreement which is determined
by a court of competent jurisdiction to be invalid or unenforceable should be
construed or limited in a manner that is valid and enforceable and that comes
closest to the business objectives intended by such provision, without
invalidating or rendering unenforceable the remaining provisions of this
agreement.

8. Action by the Committee. The parties agree that the interpretation of this
agreement shall rest exclusively and completely within the good faith province
and discretion of the Committee. The parties agree to be bound by the decisions
of the Committee with regard to the interpretation of this agreement and with
regard to any and all matters set forth in this agreement. The Committee may
delegate its functions under this agreement to an officer of the Cardinal Group
designated by the Committee (hereinafter the "designee"). In fulfilling its
responsibilities hereunder, the Committee or its designee may rely upon
documents, written statements of the parties or such other material as the
Committee or its designee deems appropriate. The parties agree that there is no
right to be heard or to appear before the Committee or its designee and that any
decision of the Committee or its designee relating to this agreement, including
without limitation whether particular conduct constitutes Triggering Conduct or
Competitor Triggering Conduct, shall be final and binding unless such decision
is arbitrary and capricious.

9. Prompt Acceptance of Agreement. The Option grant evidenced by this agreement
shall, at the discretion of the Committee, be forfeited if this agreement is not
executed by

                                       6
<PAGE>

Grantee and returned to the Company within 90 days of the Grant Date set forth
on the first page of this agreement.

10. Electronic Delivery. The Company may, in its sole discretion, decide to
deliver any documents related to the Option grant under and participation in the
Plan or future options that may be granted under the Plan by electronic means or
to request Grantee's consent to participate in the Plan by electronic means.
Grantee hereby consents to receive such documents by electronic delivery and, if
requested, to participate in the Plan through an on-line or electronic system
established and maintained by the Company or another third party designated by
the Company.

                                       7
<PAGE>

                             ACCEPTANCE OF AGREEMENT

Grantee hereby: (a) acknowledges receiving a copy of the Plan, which has either
been previously delivered or is provided with this agreement, and represents
that he or she is familiar with and understands all provisions of the Plan and
this agreement; and (b) voluntarily and knowingly accepts this agreement and the
Option granted to him or her under this agreement subject to all provisions of
the Plan and this agreement. Grantee further acknowledges receiving a copy of
the Company's most recent Annual Report and other communications routinely
distributed to the Company's shareholders and a copy of the Plan Description
dated November 17, 2003 pertaining to the Plan.

                                           --------------------------------
                                           Signature

                                           --------------------------------
                                           Print Name

                                           --------------------------------
                                           Grantee's Social Security Number

                                           --------------------------------
                                           Date

                                       8<PAGE>

                                                                 Exhibit 10.38

                            INDEMNIFICATION AGREEMENT

         This agreement is made on ____________, at Dublin, Ohio, between
Cardinal Health, Inc., an Ohio corporation (the "Company"), and ____________
(the "Director").

                             Background Information

A. The Director is a member of the Company's Board of Directors (the "Board")
and, in that capacity, is performing valuable services for the Company.

B. The shareholders of the Company have adopted a Restated Code of Regulations,
as amended (the "Regulations"), providing for indemnification of the directors
of the Company in accordance with Section 1701.13 of the Ohio Revised Code (the
"Statute"). The Regulations and the Statute specifically provide that they are
not exclusive, and contemplate that contracts may be entered into between the
Company and directors with respect to indemnification of directors.

C. The Company and Director recognize the substantial cost of carrying directors
and officers liability insurance ("D&O Insurance") and that the Company may
elect not to carry D&O Insurance from time to time.

D. The Company and Director further recognize that officers and directors may be
exposed to certain risks not covered by D&O Insurance.

E. These factors with respect to the coverage and cost to the Company of D&O
Insurance and issues concerning the scope of indemnity under the Statute and
Regulations generally have raised questions concerning the adequacy and
reliability of the protection presently afforded to directors.

F. In order to address such issues and induce the Director to continue to serve
as a member of the Board, the Company has determined to enter into this
agreement with the Director.

                             Statement of Agreement

         In consideration of the Director's continued service as a member of the
Board after the date of this agreement, the Company and the Director hereby
agree as follows:

          Section 1. Indemnity of Director. Subject only to the limitations set
forth in Section 2, below, the Company shall indemnify the Director to the full
extent not otherwise prohibited by the Statute or other applicable law,
including without limitation indemnity:

                  (a) Against any and all costs and expenses (including legal,
         expert, and other professional fees and expenses), judgments, damages,
         fines (including excise taxes with respect to employee benefit plans),
         penalties, and amounts paid

<PAGE>

         in settlement actually and reasonably incurred by the Director
         (collectively, "Expenses"), in connection with any threatened, pending,
         or completed action, suit or proceeding, or arbitration or other
         alternative dispute resolution mechanism (whether civil, criminal,
         administrative, or investigative and including without limitation an
         action by or in the right of the Company) (each a "Proceeding") to
         which the Director is or at any time becomes a party, or is threatened
         to be made a party as a result, directly or indirectly, of serving at
         any time: (i) as a director, officer, employee, or agent of the
         Company; or (ii) at the request of the Company as a director, officer,
         employee, trustee, fiduciary, manager, member, or agent of a
         corporation, partnership, trust, limited liability company, employee
         benefit plan, or other enterprise or entity; and

                  (b) Otherwise to the fullest extent that the Director may be
         indemnified by the Company under the Regulations and the Statute,
         including without limitation the non-exclusivity provisions thereof.

         Section 2. Limitations on Indemnity. No indemnity pursuant to Section 1
shall be paid by the Company:

                  (a) Except to the extent that the aggregate amount of losses
         to be indemnified exceed the aggregate amount of such losses for which
         the Director is actually paid or reimbursed pursuant to D&O Insurance,
         if any, which may be purchased and maintained by the Company or any of
         its subsidiaries;

                  (b) On account of any Proceeding in which judgment is rendered
         against the Director for an accounting of profits made from the
         purchase or sale of securities of the Company pursuant to the
         provisions of Section 16(b) of the Securities Exchange Act of 1934, as
         amended;

                  (c) On account of the Director's conduct which is determined
         (pursuant to the Statute) to have been knowingly fraudulent,
         deliberately dishonest, or willful misconduct, except to the extent
         such indemnity is otherwise permitted under the Statute;

                  (d) With respect to any remuneration paid to the Director
         determined, by a court having jurisdiction in the matter in a final
         adjudication from which there is no further right of appeal, to have
         been in violation of law;

                  (e) If it shall have been determined by a court having
         jurisdiction in the matter, in a final adjudication from which there is
         no further right of appeal, that indemnification is not lawful;

                  (f) On account of the Director's conduct to the extent it
         relates to any matter that occurred prior to the time such individual
         became a director of the Company; provided, however, that this
         limitation shall not apply to the extent such matter occurred while the
         Director was a director, officer, employee or agent

                                      -2-
<PAGE>

         of the Company or its subsidiaries (other than prior to the time such
         entity became a subsidiary of the Company); or

                  (g) With respect to Proceedings initiated or brought
         voluntarily by the Director and not by way of defense, except pursuant
         to Section 8 with respect to proceedings brought to enforce rights or
         to collect money due under this agreement; provided however that
         indemnity may be provided by the Company in specific cases if the Board
         finds it to be appropriate.

         In no event shall the Company be obligated to indemnify the Director
pursuant to this agreement to the extent such indemnification is prohibited by
applicable law.

          Section 3. Advancement of Expenses. Subject to Section 7 of this
agreement, the Expenses incurred by the Director in connection with any
Proceeding shall be promptly reimbursed or paid by the Company as they become
due; provided the Director submits a written request to the Company for such
payment together with reasonable supporting documentation for such Expenses; and
provided further that the Director, at the request of the Company, submits to
the Company an undertaking to the effect stated in Section 7, below, and to
reasonably cooperate with the Company concerning such Proceeding.

          Section 4. Insurance and Self Insurance. The Company shall not be
required to maintain D&O Insurance in effect if and to the extent that such
insurance is not reasonably available or if, in the reasonable business judgment
of the Board, either (a) the premium cost of such insurance is disproportionate
to the amount of coverage, or (b) the coverage provided by such insurance is so
limited by exclusions that there is insufficient benefit from such insurance. To
the extent the Company determines not to maintain D&O Insurance, the Company
shall be deemed to be self-insured within the meaning of Section 1701.13(E)(7)
of the Statute and shall, in addition to the Director's other rights hereunder,
provide protection to the Director similar to that which otherwise would have
been available to the Director under such insurance.

         Section 5. Continuation of Obligations. All obligations of the Company
under this agreement shall apply retroactively beginning on the date the
Director commenced as, and shall continue during the period that the Director
remains, a director of the Company or is, as described above, a director,
officer, employee, trustee, fiduciary, manager, member, or agent of another
corporation, partnership, limited liability company, trust, employee benefit
plan, or other enterprise and shall continue thereafter as long as the Director
may be subject to any possible claim or any threatened, pending or completed
Proceeding as a result, directly or indirectly, of being such a director,
officer, employee, trustee, fiduciary, manager, member, or agent.

          Section 6. Notification and Defense of Claim. Promptly after receipt
by the Director of notice of the commencement of any Proceeding, if a claim is
to be made against the Company under this agreement, the Director shall notify
the Company of the commencement thereof, but the delay or omission to so notify
the Company shall not relieve the Company from any liability which it may have
to the Director under this agreement, except to the extent the Company is
materially prejudiced by such delay or

                                      -3-
<PAGE>

omission. With respect to any such Proceeding of which the Director notifies
the Company of the commencement:

                  (a) The Company shall be entitled to participate therein at
         its own expense;

                  (b) The Company shall be entitled to assume the defense
         thereof, jointly with any other indemnifying party similarly notified,
         with counsel selected by the Company and approved by the Director,
         which approval shall not unreasonably be withheld. After notice from
         the Company to the Director of the Company's election to assume such
         defense, the Company shall not be liable to the Director under this
         agreement for any legal or other Expenses subsequently incurred by the
         Director in connection with the defense thereof except as otherwise
         provided below. The Director shall have the right to employ his own
         counsel in such Proceeding, but the fees and expenses of such counsel
         incurred after notice from the Company of its assumption of such
         defense shall be the expenses of the Director unless (i) the employment
         of such counsel by the Director has been authorized by the Company,
         (ii) the Director, upon the advice of counsel, shall have reasonably
         concluded that there may be a conflict of interest between the Company
         and the Director in the conduct of such defense, or (iii) the Company
         has not in fact employed counsel to assume such defense, in any of
         which cases the fees and expenses of such counsel shall be the expense
         of the Company. The Company shall not be entitled to assume the defense
         of any Proceeding brought by or on behalf of the Company or as to which
         the Director, upon the advice of counsel, shall have made the
         conclusion described in (ii), above. In the event the Company assumes
         the defense of any Proceeding as provided in this Section 6(b), the
         Company may defend or settle such Proceeding as it deems appropriate;
         provided, however, the Company shall not settle any Proceeding in any
         manner which would impose any penalty or limitation on the Director
         without the Director's written consent, which consent shall not be
         unreasonably withheld.

                  (c) The Company shall not be required to indemnify the
         Director under this agreement for any amounts paid in settlement of any
         Proceeding without the Company's written consent, which consent shall
         not be unreasonably withheld.

                  (d) The Director shall cooperate with the Company in all ways
         reasonably requested by it in connection with the Company fulfilling
         its obligations under this agreement.

          Section 7. Repayment of Expenses. The Director shall reimburse the
Company for all Expenses paid by the Company pursuant to Section 3 of this
agreement or otherwise in defending any Proceeding against the Director if and
only to the extent that a determination shall have been made by a court in a
final adjudication from which there is no further right of appeal that it has
been shown by clear and convincing evidence that the Director's action or
failure to act involved an act or omission undertaken with deliberate

                                      -4-
<PAGE>

intent to cause injury to the Company or undertaken with reckless disregard
for the best interests of the Company.

          Section 8. Enforcement. The Company expressly confirms that it has
entered into this agreement and has assumed the obligations of this agreement in
order to induce the Director to continue as a director of the Company and
acknowledges that the Director is relying upon this agreement in continuing in
that capacity. If the Director is required to bring an action to enforce rights
or to collect money due under this agreement, the Company shall reimburse the
Director for all of the Director's reasonable fees and expenses (including
legal, expert, and other professional fees and expenses) in bringing and
pursuing such action, unless the court determines that each of the material
assertions made by the Director as a basis for such action were not made in good
faith or were frivolous. The Company shall have the burden of proving that
indemnification is not required under this agreement, unless a prior
determination has been made by the shareholders of the Company or a court of
competent jurisdiction that indemnification is not required hereunder.

          Section 9. Rights Not Exclusive. The indemnification provided by this
agreement shall not be deemed exclusive of any other rights to which the
Director may be entitled under the Company's articles of incorporation,
Regulations, any vote of the shareholders or disinterested directors of the
Company, the Statute, or otherwise, both as to action in his official capacity
and as to action in another capacity while holding such office.

          Section 10. Separability. Each of the provisions of this agreement is
a separate and distinct agreement and independent of the others so that, if any
provisions of this agreement shall be held to be invalid and unenforceable for
any reason, such invalidity or unenforceability shall not affect the validity or
enforceability of the other provisions of this agreement.

          Section 11. Modification to Applicable Law. In the event there is a
change, after the date of this agreement, in any applicable law (including
without limitation the Statute) which: (a) expands the right of an Ohio
corporation to indemnify a member of its board of directors or an officer, such
change shall be automatically included within the scope of the Director's rights
and Company's obligations under this agreement; or (b) narrows the right of an
Ohio corporation to indemnify a member of its board of directors or an officer,
such change, to the extent not otherwise required by such law, shall have no
effect on this agreement or the parties' rights and obligations hereunder.

          Section 12. Partial Indemnity. If the Director is entitled under any
provision of this agreement to indemnity by the Company for some or a portion of
the Expenses actually or reasonably incurred by him in the investigation,
defense, appeal, or settlement of any Proceeding, but not for the total amount
thereof, the Company shall nevertheless indemnify the Director for the portion
of such Expenses to which the Director is entitled.

         Section 13. Governing Law. This agreement shall be interpreted and
enforced in accordance with the laws of the State of Ohio, without regard to
choice of law principles.

                                      -5-
<PAGE>

          Section 14. Successors. This agreement shall be binding upon, inure to
the benefit of, and be enforceable by and against the Director and the Company
and their respective heirs, successors, and assigns. The Company shall require
any successor or assign (whether direct or indirect, by purchase, merger,
consolidation, or otherwise) to all or substantially all of the business and/or
assets of the Company, expressly, absolutely, and unconditionally to assume and
agree to perform this agreement in the same manner and to the same extent that
the Company would be required to perform it if no such succession or assignment
had taken place.

         Section 15. Prior Agreements. This agreement shall supersede any other
agreements entered into prior to the date of this agreement between the Company
and the Director concerning the subject matter of this agreement.

         Section 16. Consent to Jurisdiction. The Company and the Director each
hereby irrevocably consents to the jurisdiction of the courts of the State of
Ohio for all purposes in connection with any action or proceeding which arises
out of or relates to this agreement and hereby waives any objections or defenses
relating to jurisdiction with respect to any lawsuit or other legal proceeding
initiated in or transferred to such courts.

                                              CARDINAL HEALTH, INC.

                                              By
                                                 -----------------------------

                                              DIRECTOR:

                                              --------------------------------

                                      -6-

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