Caremark shareholders approve CVS bid

March 26, 2007

Shareholders of Caremark Rx Inc., the nation?s No. 2 PBM, gave the nod to a $26.5-billion merger deal with CVS Corp., the nation?s No. 2 retail drug chain.

Shareholders of Caremark Rx Inc., the nation's No. 2 PBM, gave the nod to a $26.5-billion merger deal with CVS Corp., the nation's No. 2 retail drug chain. The votes came after months of corporate wrangling that included lawsuits and sales pitches to investors and market analysts, as a result of a rival bid from Express Scripts. Commenting on the approval of the merger, George Paz, president/CEO and chairman of Express Scripts, said, "I want to thank the stockholders of both Caremark and Express Scripts for their consideration during this effort, our advisers for their assistance, and, most especially, every Express Scripts employee for their many contributions." Paz added that Express Scripts is positioned for strong growth and will continue to be a leader in many areas. At least one independent pharmacy owner doesn't feel threatened by the merger. Dave Whalley, R.Ph., and owner of Newport Health Mart in Newport, R.I., told Drug Topics, "That's a brilliant move on CVS' part to become more involved in the reimbursement decisions by owning the (second) biggest PBM. CVS will have a lot of leverage with drug companies and insurance companies that they didn't have before. What is good for CVS is good for me as far as what they can do in terms of defining the marketplace for prescription drugs. I don't think legislation will be passed that would enable independent pharmacies to negotiate with insurance companies. With chains having more leverage and more say in it, it trickles down and will be better for us. The rumor now is Walgreens may go after Medco."

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