Express Scripts to buy WellPoint units for $4.7 billion
Express Scripts Inc
NextRx subsidiaries provide pharmacy benefits management services to about 25 million Americans and manage more than 265 million adjusted prescriptions annually.
The companies said the deal includes a 10-year contract for Express Scripts to provide services to WellPoint, the largest U.S. health insurer by membership, which will retain control of medical policy, formulary and integrated disease management in the subsidiaries.
Health insurers endured a tough 2008, marked by profit warnings and questions about their financial positions in a shaky economy, and their shares have been battered in recent weeks on worries about potential health reform measures.
The possibility of health insurers divesting their captive drug-benefit units has long been fodder for Wall Street speculation and analysts have previously said the companies may be pressured to spin off units if their shares continued to languish.
Nasdaq-listed shares of Express Scripts closed at $49.17 on Thursday ahead of a market holiday on Friday, while WellPoint's shares closed at $40.34 on the New York Stock Exchange.
(Reporting by Ajay Kamalakaran in Bangalore, Editing by Ian Geoghegan)
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