Centene has completed its $1.35 billion divestiture of Magellan Rx to Prime Therapeutics.
The move adds Magellan's specialty drug management capabilities to Prime Therapeutics' suite of pharmacy benefit management tools, allowing it to enhance its collection of solutions. Prime is collectively owned by 19 Blues plans and affiliates.
Magellan Rx also brings 1.7 million new PBM members into the fold, Prime said.
“This is a rare opportunity to bring together two highly respected organizations to create an enterprise that is greater than the sum of its parts. Together, we will deliver on the health care Quadruple Aim—affordability, patient service, improved health and engagement with caregivers,” said Ken Paulus, CEO of Prime Therapeutics, in the announcement.
Centene elected to sell off Magellan Rx as part of its wide-ranging value-creation plan. Under this initiative, the government insurance giant is doing a review of its full portfolio. Magellan Rx joined the company as part of its acquisition of Magellan Health, which closed in January.
"We are pleased to continue delivering on our value creation plan with the closing of this transaction, positioning us to remain focused on our core business and strategic priorities on behalf of shareholders," said Sarah London, Centene CEO, in the release.
For now, Magellan Rx will continue to operate independently, and Prime said it plans to begin the integration process in the coming months. Magellan Rx CEO Mostafa Kamal will continue in that role and will join the Prime Therapeutics leadership team.
Integration planning is underway, Prime said, and both brands will remain in the market for up to a year as the companies analyze and explore new branding opportunities.
“We’re bringing some of the brightest minds and most dedicated teams in pharmacy together to develop and deliver a next-generation care model that will transform the industry, unlock new possibilities and deliver even more value to those we serve,” said Kamal in the announcement.