Rhode Island-based CVS Caremark has agreed to acquire the Medicare Part D business of Rye Brook, N.Y.-based Universal American for about $1.2 billion, reports Healthcare Finance News.
The deal will more than double the number of Part D lives Caremark serves, from 1.2 million to more than 3 million, making it one of the nation's largest providers of prescription services to Part D enrollees.
"A growing portion of the country's population will receive their prescription drug coverage under Medicare plans, driven both by age demographics and the anticipated shift of retirees from employer based coverage to Medicare that will likely result from healthcare reform," Per Lofberg, president of Caremark's pharmacy services division, said in a statement.
"The Medicare Part D program is integral to CVS Caremark's long-term growth strategy. We believe that bringing together these two businesses will strengthen our competitive offerings, enabling us to provide Medicare beneficiaries with expanded products and services and lower the cost of pharmacy care," he noted.
Caremark also said the transaction is in line with its goals of growing the company and improving returns on invested capital. The deal would be accretive to earnings per share in its first full year.
The deal is subject to a variety of regulatory reviews, but is expected to close by the end of the second quarter.
For more:
- read the Healthcare Finance News article
- read the press release