Wednesday, 16 January, 2019

Cigna to buy Express Scripts in $67 billion deal

Cigna to buy Express Scripts in $67 billion deal Cigna Seeks to Buy Drug Plan Firm for $67 Billion
Ginger Lawrence | 08 March, 2018, 23:26

Cigna shares fell 10.2 percent to $174.45.

United States health insurer Cigna said on Thursday it would buy pharmacy benefits manager Express Scripts for about $54 billion, a tie-up that reflects pressure on healthcare companies to grow bigger to cut costs.

Express Scripts, which employees thousands of employees at its Columbus facility, runs prescription-drug plans for employers, insurers and others.

The companies said the combination will eventually save $600 million a year due to administrative efficiencies.

Express Scripts, Inc is a pharmacy benefit management (PBM) company in North America, offering a range of services to its clients, which include health insurers, third-party administrators, employers, union-sponsored benefit plans, workers' compensation plans and government health programs.

The deal announced Thursday consists of $48.75 in cash and 0.2434 shares of stock of the combined company per Express Scripts share. However, it will first need approval from regulators, as well as shareholders. Cordani will lead the combined company, with his Express Scripts counterpart, Tim Wentworth, staying on as a president.

NASA to take people's names to the sun
NASA points out that, that's fast enough to travel between Washington D.C. and Tokyo in less than a minute. The US space organization on Tuesday said it would acknowledge entries until April 27, 2018.

The Express Scripts combination would put the Cigna model closer to that of UnitedHealth Group Inc (UNH.N), the industry's biggest health insurer.

In the long run, the interests of patients, providers, and manufacturers are not well served by these arrangements, precisely because these practices encourage large list price increases to fuel the pricing schemes. The deal is created to give Cigna a competitive advantage-or at least a fighting chance-amid a series of big moves in the PBM market by heavy-hitters looking to rein in rising costs as the healthcare industry's landscape keeps shifting.

Health insurance company Cigna Corp. Analysts said shares in Humana - which had been seen as a possible target for Cigna - could fall on Thursday.

David M. Cordani, president and chief executive officer of Cigna, said: "Cigna's acquisition of Express Scripts brings together two complementary customer-centric services companies, well-positioned to drive greater quality and affordability for customers".

At 1140 GMT, Express Scripts shares were up 16% in pre-market trade to $85.00. Last month the grocery chain Albertsons agreed to buy Rite-Aid pharmacies, and in January, Amazon, JPMorgan Chase and Warren Buffet's Berkshire Hathaway said they were joining forces to create an undefined health care company.

Morgan Stanley was the financial adviser to Cigna. Palladium Partners LLC raised its stake in shares of Express Scripts by 4.1% during the 4th quarter.

Trending Now

Dont Miss