NCPA opposes Express Scripts purchase of NextRx

May 4, 2009

WellPoint's plan to sell its NextRx pharmacy benefits management unit to St. Louis-based Express Scripts is drawing criticism from independent pharmacists.

WellPoint's plan to sell its NextRx pharmacy benefits management unit to St. Louis-based Express Scripts is drawing criticism from independent pharmacists.

The National Community Pharmacists Association (NCPA), in a letter to Federal Trade Commission Chairman Jon Leibowitz, warned of "potential anticompetitive effects" from the deal, valued at $4.68 billion.

The letter voiced the association’s concern that the sale would combine two of the nation's four largest pharmacy benefit managers, called PBMs. "This in turn will increase the likelihood of collusion and adversely impact both consumers and pharmacy small business owners," the letter said.

Recently, NCPA urged the FTC to reconsider the CVS Caremark merger as a result of alleged anticompetitive practices and patient privacy violations. The three largest PBMs - CVS/Caremark, Medco, and Express Scripts - cover a combined 240 million people nationally. The sale of WellPoint's unit to Express Scripts would increase that to 280 million, or 80 percent of the market, according to the letter.

“The proposed acquisition threatens to worsen the competitive situation in an already highly concentrated market,” the letter stated. WellPoint spokeswoman Kristin Binns said the company is reviewing the letter.

The sale is expected to be completed in the second half of 2009.