In December 2022, Magellan Rx officially became a part of Prime Therapeutics.
Now, Magellan's chief Mostafa Kamal is taking the helm of the entire organization, and he told Fierce Healthcare that he's focused on continuing to align the organizations' cultures and make it clear that not all pharmacy benefit managers are built the same.
Prime is collectively owned by 19 Blue Cross and Blue Shield plans, and that nonprofit foundation means the PBM is "not married to any business model," he said. This means the company is prepared to adapt should Congress' efforts to reform the industry bear fruit.
"I think it's important to highlight the fact that not all PBMs are created equal," Kamal said. "And there are big-scale PBMs, like Prime, who are here to do the right thing for the right reasons, and don't have a profit motive."
Kamal succeeds Prime Therapeutics CEO Ken Paulus, who will retire. "I leave Prime in capable hands," Paulus said in a statement.
Kamal said that he comes to the PBM industry from a financial background and was working at a travel company when the call came from MedCo Health Solutions, a pharmacy benefit manager that merged with Express Scripts in 2012.
MedCo was looking to start a new pricing department, he said, and wanted to bring in outside viewpoints on key topics like risk adjustment and demand management. Kamal said it was around the time of the Express Scripts merger that he got the call from Magellan, which was looking to diversify beyond its foundation in behavioral health.
He said he was initially skeptical of the prospect of launching a new PBM, given his experience at an industry giant, but after meeting with the team, he saw the potential of the company, which was building its initial focus in specialty pharmacy. This proved fortuitous, as specialty pharmacy is now the largest driver of drug spend, he said.
"We really built Magellan Rx with a specialty-first focus and orientation and had a great time over the 10 years building and creating the company, essentially, from an idea to a meaningful player," Kamal said. "That took us right up to our combination with Prime."
Magellan was initially acquired in early 2022 by government insurance giant Centene, but the payer elected to bring the behavioral health business into the fold while selling off the PBM arm as part of its value-creation plan.
Kamal said that when Magellan Rx was courting buyers, the team wanted to ensure it found a company that would allow it to leverage its capabilities for a larger impact. Prime's strengths were complementary to Magellan's, he said.
"The markets that Magellan Rx focused on, Medicaid and speciality, were areas where Prime was looking to enhance and upskill," he said. "The areas where Magellan didn't play at all—like a big health PBM business, a Blues PBM business—Prime was world class."
In addition, Kamal said the two aligned on a community, patient-centric approach, which is central to the Blues DNA. Their nonprofit focus was "refreshing" for PBM, he added.
Kamal said there's a huge level of excitement within Prime about the company's next chapter as it continues integration with Prime and plans for the future.
"I believe it's our moment in time to make a material difference and impact on this marketplace at a time where the marketplace is clamoring for it," he said. "So that's what really attracted me most to be absolutely enthusiastic and honored to step into this role as CEO of Prime."