With approximately $400 billion in annual spend, healthcare has become an attractive market for tech companies. With the threat of Amazon, who are reportedly set to enter the prescription drug market, Express Scripts have acquired medical benefit management service EviCore for $3.6 billion. The industry is becoming increasingly competitive with regards to drug pricing, where manufacturing and operational costs are coming under increased scrutiny and created room for negotiations across the board.
Medical benefit management is also growing in prominence, with over $300 billion spent annually. Express Scripts’ acquisition of EviCore will therefore enable the company to develop a new range of solutions and provide a greater client reach. Providing integrated pharmacy benefit management services, the company also distributes a full range of biopharmaceutical products and extensive cost-management and patient-care services.
"The rising cost of healthcare is one of the most important issues facing Americans today," commented Tim Wentworth, President and CEO of Express Scripts. "Together with EviCore, Express Scripts will be an even more powerful partner in managing costs for patients and payers, bringing us closer to our goal of becoming the nation's leading patient benefit manager.
By further strengthening our independent model and creating numerous opportunities for growth, the acquisition of EviCore will deliver value for our clients, patients, providers, and shareholders."
Express Scripts management offering will be complemented by EviCore's medical benefits management (MBM) platform, where its pharmaceutical benefits model (PBM) and eviCore's medical cost containment capabilities will cement Express Script’s presence within medical benefit management.
Set to close at the end of 2017, the acquisition will support the reduction in medical costs for patients and increase quality of care through a number of flexible medical benefits management solutions in a multitude of specialties.
"The greatest opportunity to improve healthcare is by reducing wasteful spend and overutilisation while delivering quality outcomes," said John Arlotta, Chairman and CEO of EviCore.
"Together, EviCore and Express Scripts will be uniquely positioned to tackle these problems."