Walgreens Infusion Services now independent with private equity partner


The new independent company, Option Care, sees opportunity for growth in the $14 billion alternate site infusion market.

Walgreens Infusion Services, Walgreens' home infusion business, is now a new independent company, Option Care, positioned for growth in this $14 billion alternate site infusion market, according to its majority owner Madison Dearborn Partners (MDP).

MDP, a private equity firm based in Chicago, seized this business opportunity because of its capacity to reach over 90% of the U.S. market with its 92 infusion pharmacies and 110 alternate treatment sites. Walgreens still has a significant minority stake in the new company, noted Option Care CEO Paul Mastrapa in a media conference call last week.

“As of today, we are an independent company, laser-focused on high-quality patient care and partnering with all healthcare stakeholders [such as health plans, health systems, and pharmaceutical manufacturers] to deliver best-in-class infusion care,” said Mastrapa, who had been the chief financial officer with Option Care from 2002 to 2007.

The future

Option Care has a market share of 10% and expects that to grow as the market continues to expand.

“Today, patients are often cared for in an outpatient hospital setting, a physician office, or a skilled nursing facility. As the industry looks more strategically at where to deliver infusion services, more stakeholders are looking for increased access to an alternate site-the home,” Mastrapa explained. “Option Care delivers 95% of its services in patients’ homes.”


The demand for infusion care will grow at approximately 10% annually due to an aging population, an increasing drug pipeline of treatments, and the pressure to keep healthcare costs down in this ever-expanding health insurance market place, created by the Affordable Care Act.

MDP anticipates that this home infusion business model will be advantageous to payers, healthcare providers, patients, and pharmaceutical manufacturers, Mastrapa noted.

“Our investments will focus on expanding our clinical offering, enabling more effective partnerships with healthcare stakeholders, along with initiatives to drive efficiencies within our operating model,” he said.

Significant cost savings

The administration of chemotherapy drugs can be very costly in a hospital setting, as high as $1,500 per day. Option Care’s home infusion services can offer significant savings of about $150 per day or 10% of that hospital expense.

“We have seen, on average, about 10 times the savings based on the site of care-home infusion care. From an outpatient setting, we have seen three to five times savings versus the hospital setting,” Mastrapa said.


“A core part of our product is to enable the patient to self-administer the therapy. So through our infusion pump technology, supportive technologies, and the training, we help to get the patients as independent as possible, leading to additional cost savings, by not having to have a caregiver there at any given point in time,” he continued.

Healthcare outcomes are very important to Option Care, which closely monitors the prescribed therapies and tracks patient completion of the treatment course.

“We have a track record of about 97% of successful completion of therapy across all of our patients-about 50,000 patients across the country,” Mastrapa said.

Working with payers

Option Care is working with some of the national and regional health plans to help realign patient member incentives to choose the more cost-effective site of infusion services.

Benefit design will help to drive patients to home infusion options through lower co-payments or eliminating co-pays, he said.

“We are in the early days of seeing benefit design that helps to drive member incentives to use the right site of care,” Mastrapa said.

See also:

The consequences of high out-of-pocket medication costs

Report: Specialty drug costs will skyrocket in next two years

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