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Prescription Managers Express Scripts, Medco Propose Merger Prescription Managers Express Scripts, Medco Propose Merger

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health care

Prescription Managers Express Scripts, Medco Propose Merger

The top two U.S. companies that handle prescription drug benefits, Express Scripts and Medco Health Solutions, announced an agreement Thursday to join forces. If approved, the merger would create a prescription giant that would manage the prescriptions of a third of all Americans –135 million people, AP reported.

The companies say the $29.1 billion deal will help achieve key goals of the 2010 health care reform law by lowering costs and improving patients' health. The deal would surpass the $21.7 billion agreement that formed CVS Caremark in 2007.


A new, bigger company would have more power to demand discounts from pharmaceutical companies. But independent pharmacies immediately opposed the merger and asked regulators to block it.

Pharmacy benefit managers are the go-betweens linking employers who offer drug benefits and the companies making the medicines.  They process mail-order prescriptions and handle bills when prescriptions are filled at retail pharmacies. They can negotiate drug prices, help set co-pays and remind patients to take pills. Express Scripts and Medco handled more than 1.7 billion prescriptions in 2010, taking in about $110 billion in revenue.

The National Community Pharmacists Association spoke out strongly against the deal.


“The proposed merger of Express Scripts and Medco would quite simply make a bad situation much worse for American employers, government agencies, consumers and pharmacists,”  NCPA executive vice president and CEO Douglas Hoey said in a statement.

“The major PBMs already wield an unchecked, one-sided advantage in setting contract and reimbursement terms for community pharmacists, undermining their viability to continue serving patients. Approval of this merger would further distort this marketplace, to the detriment of patients, true competition and lower prices.”

He said his group and the National Association of Community Drug Stores were consulting with state attorneys general and the Federal Trade Commission, which must approve the deal.


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