Pharmacy benefit managers (PBMs) Express Scripts and Medco Health Solutions have entered into a definitive merger agreement.
Under the terms of the agreement, shareholders of Medco, based in Franklin Lakes, N.J., will receive $71.36 per share in cash and stock, or $29.1 billion based on its July 20 closing price. Medco shareholders will receive $28.80 in cash and 0.81 shares for each Medco share they own upon closing of the transaction. The agreement has been unanimously approved by the boards of directors of both companies, according to Express Scripts. The transaction is expected to close in the first half of 2012.
The merger will combine the expertise of the two PBMs to enable cost savings for patients and plan sponsors, create supply-chain efficiencies, close gaps in care and achieve greater patient medication adherence through a combined behavioral and clinical approach, according to Express Scripts, of St. Louis. In addition, the merger will enable management of the cost and care associated with specialty medications and enhance mail-order pharmacy technology.
The merger is subject to regulatory clearance and Express Scripts’ and Medco’s shareholder approvals and other customary closing conditions. The corporate headquarters for the combined company will be in St. Louis, Express Scripts added.