UnitedHealth announced an agreement to acquire Catamaran for about $12.8 billion in cash, and is planning to merge the pharmacy benefit manager into its own, free-standing pharmacy benefits business, OptumRx. This deal is expected to close in the fourth quarter of 2015, after shareholder approval, regulatory approval and other customary closing conditions.
This deal is expected to combine the strength of Catamaran’s 400 million prescriptions with OptumRx’s 600 million annual prescriptions to rival the larger players like CVS/Caremark and Express Scripts. The merger is also expected to combine Catamaran’s technology platform with the data and analytics capabilities of OptumRx.
This merger has certain similarities to the Express Scripts and Medco $29.1 billion merger in 2012. This deal created one company filling a combined 1.4 billion prescriptions per year, and Express Scripts used Medco’s technology platform as well. At the time of the deal, Express Scripts and Medco were the largest and third-largest pharmacy benefits managers, respectively. The deal was scrutinized for eight months by the FTC for potential antitrust implications after being approved. However, the effect for pharmacies was that Express Scripts and Medco maintained separate contracts and networks for at least 18 months post-merger.
For specialty and compounding pharmacies, this may mean that the combined PBM may push for decreased reimbursements and may seek to force more patients through mandatory, in-house mail order and specialty pharmacies. In addition, programs initiated and implemented by Catamaran may not carry forward to the merged entity.
