WellPoint Sells NextRx Units - Analyst Blog
Recently, WellPoint, Inc. (WLP) announced that its NextRx subsidiaries have been purchased by Express Scripts, Inc. (ESRX) for $4.675 billion, which includes the consideration for the value of a future tax benefit for the acquirer based on the transaction structure.
The deal provides for a 10-year agreement under which Express Scripts will provide the members of the health plans of WellPoint with pharmacy benefit management services, including home delivery and specialty pharmacy services. Both companies intend to leverage integrated medical and pharmacy data to drive innovation in the development and implementation of integrated health benefits.
The deal should improve health outcomes for members and bring down healthcare costs. Through this deal, WellPoint will look to improve the efficacy of its clinical competencies through the success of Consumerology, Express Scripts' application of the behavioral sciences, to aid members make better decisions related to healthcare.
Management expects to record a gain of $4.34 per share from the transaction in the fourth quarter of this year. The industry-leading programs coupled with the best practices from both participants of the deal will benefit plan sponsors and members. Furthermore, administrators of healthcare will have access to greater insight into drug trends and usage through Express Scripts' innovative reporting and modeling tools.
WellPoint, formed on Nov 30, 2004, through the merger of Anthem, Inc. and WellPoint Health Networks, Inc. and headquartered in Indianapolis, Indiana, is the largest publicly traded managed care organization in terms of membership and the largest of the Blue Cross Blue Shield (BCBS) plan providers in the United States. It competes with players such as Aetna Inc. (AET), CIGNA Corp. (CI) and Unitedhealth Group, Inc. (UNH)
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