UnitedHealth buys Catamaran for $12.8b

By AFP - Mar 30,2015 - Last updated at Mar 30,2015

NEW YORK — UnitedHealth Group said Monday it will acquire smaller rival Catamaran for $12.8 billion, in a move they said would give them more pricing power in the pharmacy benefits business.

UnitedHealth will combine Catamaran with its own pharmacy benefit manager (PBM) OptumRx, which would propel the combined company to third place in the industry behind Express Scripts and CVS Caremark. PBM’s manage prescription drug claims between health insurers and insurance plan members.

Through their negotiations with drug suppliers, drug costs to insured patients can be heavily discounted from the sticker price. UnitedHealth will finance the deal using available cash and new debt, and expects to be completed by the end of this year.

The two companies together expect to fill one billion prescriptions in 2015, which “will enable the combined entity to be a competitive force in the PBM industry” and bring down drug costs for clients, they said.

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