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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Medcohealth Solutions Common Stock | NYSE:MHS | NYSE | Ordinary Share |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 70.30 | 0.00 | 01:00:00 |
Pharmacy-benefit manager Express Scripts Inc. (ESRX) and drugstore chain Walgreen Co. (WAG) don't appear any closer to mending their rift and signing a new deal for 2012, Express Scripts's top official indicated Wednesday.
A dispute over terms for a new contract erupted publicly in June, when Walgreen said it wouldn't be part of Express Scripts's pharmacy-provider network when their current deal expires after this year. While analysts initially believed some kind of agreement was still possible, the companies haven't settled their differences and appear ready to break ties.
"There's a big division right now between us and them," said George Paz, Express Scripts's chairman and chief executive, during a Lazard Capital Markets health-care conference.
He reiterated that Express Scripts is willing to sit down and talk with Walgreen, but said other side doesn't "appear to be wanting to do that."
Companies like Express Scripts manage prescription-drug benefits and claims for employers and health-insurer clients. They also run mail-order pharmacies, which are a rising source of tension between them and traditional retail outlets. Pharmacy groups have strongly opposed Express Scripts's plan to buy rival pharmacy-benefit firm Medco Health Solutions Inc. (MHS).
Walgreen's exit from Express Scripts's network means the benefit manager's clients will have to go elsewhere to fill prescriptions. Walgreen has acknowledged Express Scripts's network represents about $5.3 billion in annual sales, but said the long-term fallout from accepting unfavorable contract terms would be worse than the short-term impact. The two sides have had differing takes on who is pushing unfavorable terms.
Analysts don't see as much of an immediate hit for Express Scripts, although the company must convince customers they'll retain easy pharmacy access without the largest U.S. drugstore chain's thousands of outlets. Express Scripts has said it has strong client support to move ahead without an agreement.
Paz on Wednesday discussed his view of the sticking points and how the dispute unfolded while reiterating that Express Scripts remains willing to talk. He also said the money and time both companies have spent managing this dispute is "pretty ludicrous," and that it's "sad we're in this situation."
Express Scripts shares recently traded down 1.8% to $45.96 while Walgreen shares moved up 5 cents to $32.60.
-By Jon Kamp, Dow Jones Newswires; 617-654-6728; jon.kamp@dowjones.com
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