Aetna To Own 100 Percent Of Aetna Specialty Pharmacy
Action taken to bring joint venture under single management
HARTFORD, Conn., Oct. 26, 2005 — Aetna (NYSE: AET) today announced that it intends to increase its ownership to 100 percent of Aetna Specialty Pharmacy, a joint venture it launched with Priority Healthcare Corporation last year to better serve chronically ill Aetna members who need specialty pharmaceuticals.
Aetna, which currently owns 40 percent of the venture, will purchase the remaining 60 percent. Terms were not disclosed, although the purchase price is not material to Aetna, which will finance the transaction from available cash. The transaction, which is subject to federal antitrust regulatory approval, is expected to close by the first quarter of 2006.
In March 2005, Aetna Specialty Pharmacy opened a 63,000 square-foot state-of-the-art facility in Orlando, Fla. that distributes specialty pharmaceutical medications to over 25,000 Aetna members each month. The business employs approximately 280 people, who now will become part of Aetna.
"We've evaluated our options and have concluded that bringing Aetna Specialty Pharmacy under our management now is the right strategic decision," said Aetna President Ronald A. Williams. "This action, coupled with others we are taking, such as launching a full-service behavioral health business at the end of the year, will better position us to provide integrated solutions for our customers.
"We have built Aetna Specialty Pharmacy into a best-in-class operation that integrates medical and pharmacy benefits for the chronically ill, provides leveraged buying power to help manage costs and help improve quality for our customers and high-touch care management service for our members."
Eric Elliott, head of Aetna Pharmacy Management, said the specialty pharmacy capability that his organization has helped build from the ground up will differentiate Aetna's pharmacy benefit management business.
"Aetna Specialty Pharmacy increases our capacity to deliver an industry-leading clinical management program that helps manage overall health care costs," Elliott said. "Our partnership with Priority in building this business has been outstanding and today's action will allow us to strengthen the management and integration of this service for our members."
Aetna Specialty Pharmacy serves the company's chronically ill members who suffer from diseases such as anemia, cancer, Crohn's Disease, cystic fibrosis, Gaucher's Disease, hemophilia, hepatitis, HIV/AIDS, Multiple Sclerosis, pulmonary hypertension, renal failure, respiratory syncytial virus, rheumatoid arthritis, organ transplants and others. Medications for those diseases are expensive, and administration of those medications requires intensive coordination.
Express Scripts Inc. recently completed its acquisition of Priority Healthcare. The joint venture agreement that created Aetna Specialty Pharmacy in August 2004 originally included an option for Aetna to purchase Priority Healthcare's share beginning in 2008, but also allowed for an acceleration of the purchase option due to a change in control of Priority.
As one of the nation's leading providers of health care, dental, pharmacy, group life, disability and long-term care benefits, Aetna puts information and helpful resources to work for its approximately 14.435 million medical members, 12.976 million dental members, 9.117 million pharmacy members and 13.662 million group insurance members to help them make better informed decisions about their health care and protect their finances against health-related risks. Aetna provides easy access to cost-effective health care through a nationwide network of more than 684,000 health care professionals, including over 405,000 primary care and specialist doctors and 4,135 hospitals. For more information,
please visit www.aetna.com. (Figures as of June 30, 2005)