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Cigna acquires Express Scripts, plans to expand health services portfolio

Cigna acquires Express Scripts, plans to expand health services portfolio

The price includes $48.75 in cash and 0.2434 shares of stock of the combined company per Express Scripts share, the companies said in a statement Thursday.

Anthem had been a major customer for Express Scripts, but said previous year it would not be renewing the contract and was instead planning to launch a new pharmacy benefit management company, with CVS providing prescription fulfillment and claims processing services. In December, CVS Health, a major PBM, announced it would acquire the insurer Aetna. Cigna and Express Scripts are embroiled in separate litigation involving Anthem.

Executives with both companies praised the deal, which they hope to complete by the end of the year. Express Scripts also distributes a full range of biopharmaceutical products and provides extensive cost-management and patient-care services.

"Our society needs a step function improvement in affordability that is delivered in a highly personalized fashion, having the consumer touch points, having the further depth in clinical engagement", Cordani said on a conference call with analysts. 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.

The deal comes at a time when consumers and lawmakers are increasingly concerned about rising health care costs, including prescription drugs. The president's Council of Economic Advisers, in a recent report, criticized the companies' market power and the opacity of their drug-price contracts. The company had a trading volume of 39,907,624 shares, compared to its average volume of 4,550,000. The broad Health Care Plans industry has an average P/S ratio of 16.24, which is significantly worse than the sector's 6.58. OptumRx, a division of UnitedHealth Group Inc.

CVS acquired pharmacy benefit manager Caremark in 2006. Anthem since then said it would not renew its PBM contract with Express Scripts.

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As for their sleep problems now? And the actress shared that they really helped to fix her sleeping pattern. Looking at her, David said: "Yeah I seem to remember Charlize that you've done this a few times".

"Now, if I make an investment to increase my drug spending, with the hope that it flows back to lower medical spending in the future, I know that I'm going to benefit from that", said Craig Garthwaite, an associate professor of strategy at the Kellogg School of Management.

As mentioned above, Express Scripts is having an incredibly strong start to the trading session this morning after announcing that it has entered into a definitive agreement to be acquired. Express Scripts will retain a headquarters in St. Louis. This translated into an aggregate value of about $54 billion.

David Balto, an antitrust lawyer who has opposed the CVS-Aetna deal and other health insurance mergers argued that the new deal could mean trouble for CVS-Aetna.

Before the deal, our analysis was that ESRX faced considerable risk.

Gerard Anderson, a professor at Johns Hopkins Bloomberg School of Public Health, worries that large employers will have less choice when they are looking for health benefits. Organizations in that category manage prescription drug programs for commercial and government-provided health plans. Tim Wentworth, president and CEO of Express Scripts, will be president and chief operating officer of Health Services.

Cigna (NYSE: CI), based in Bloomfield, CT, said in its announcement that it was purchasing Express Scripts in a deal aimed at "making healthcare simpler" for its members, and at creating "an expanded portfolio of health services with greater choice".

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