Another PBM Sold As Express Scripts Buys Diversified


Express Scripts has agreed to purchase a rival pharmacy benefit manager, Diversified Pharmaceutical Services, for $700 million. When the transaction is completed, Express Scripts will double its membership to 46 million, solidifying its position as the third-largest PBM.

SmithKline Beecham's sale of Diversified marks the second time in three months that a pharmaceutical maker has divested itself of a PBM at a substantial loss. Late last year, Eli Lilly & Co. sold financial weakling PCS Health Systems, the nation's largest PBM, to Rite Aid for $1.5 million — $2.5 million less than it paid for it. Diversified's price is a third of what it cost SmithKline in 1994.

Both sales come as the Food and Drug Administration is starting to clamp down on promotional claims by PBMs that are owned by drug companies.

The timing of the Diversified sale is also interesting in that the PBM is near a turning point. Contract language in United HealthCare's 1994 sale of Diversified that required the HMO to continue to use Diversified as its PBM for several years will expire shortly.

The second-largest PBM, Medco, is owned by Merck & Co. Merck has no plans to sell its highly profitable subsidiary.

Career Opportunities

HAP, a subsidiary of Henry Ford Health System, is a nonprofit health plan providing coverage to individuals, companies and organizations. This executive develops strategies to meet membership and revenue targets through products, pricing, market segmentation and advertising.  Aligns business among Business Development, Commercial Sales, Medicare and Public Sector Programs and Product Development. Seeks to enhance and be responsible for business development and expansion through the development of an effective product portfolio, strong interpersonal relationships and service excellence.

Apply via email to jfedder1@hfhs.org or online at http://p.rfer.us/HENRYFORDlXqAJA

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