Premier Inc. recently announced it was exiting its specialty pharmacy business. Certain of Premier’s consolidated subsidiaries entered into a definitive asset purchase and sale agreement with ProCare Pharmacy LLC, a subsidiary of CVS Health, under which Premier will sell certain assets related to its specialty pharmacy business for $22.5 million, plus up to an additional $20.0 million for inventory, each subject to adjustment. The transaction is expected to close in the current quarter ending June 30, 2019.
The sale was made in connection with the company’s plans to discontinue its specialty pharmacy operations conducted by both Acro Pharmaceutical Services and Commcare Pharmacy by June 30, 2019.
Premier’s strategy was to offer specialty pharmacy products and services to member hospitals. Premier’s specialty pharmacy business at the time of discontinuing served approximately 367 hospitals across 66 health systems.
Premier offered three specialty pharmacy solutions to member hospitals:
- A fully outsourced model. Premier would provide a complete private-label solution to a health system that was not interested in becoming a full-service specialty pharmacy.
- A partially outsourced model. Premier would provide a private-label solution to a health system that wanted to dispense certain specialty pharmaceuticals internally.
- A “wrap” model. Premier would provide specialty pharmacy solutions to fill “gaps” for the health system that had a specialty pharmacy program in place.
Premier was able to flex its specialty pharmacy solution to health system members, relying on its technology infrastructure to be a key differentiator.
Premier found the evolving specialty pharmacy market dynamics does not fit with their strategy to deliver superior financial performance and long-term value for stockholders. Combined with an estimated $6 million loss for the specialty pharmacy business, Premier decided to move on.