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Centene is divesting both Magellan Rx and PANTHERx Rare and will exit the pharmacy benefit management space.
Prime Therapeutics has agreed to acquire Magellan Health’s pharmacy business, Magellan Rx Management, for about $1.35 billion. The sale is expected to be completed in the fourth quarter of 2022.
Prime indicated the acquisition is to access Magellan Rx’s specialty drug management program. Magellan Rx has nearly two decades of specialty drug management expertise managing complex patient populations across both the pharmacy and medical benefit serving more than 16 million members. Magellan Rx also has expertise with Medicaid and state pharmacy program administration solutions.
Combining Prime’s channel-independent model with Magellan Rx’s portfolio of medical pharmacy solutions is expected to create a new specialty drug management model, the company said.
“By bringing together the capabilities and talents of Prime and Magellan Rx, we are positioned to deliver breakthrough value to the clients and members we serve. We are excited about the solutions our shared teams will bring to the industry as we strive to deliver progress against the Quadruple Aim,” Ken Paulus, chief executive officer and president of Prime Therapeutics, said in a press release.
The managed healthcare company Centene Corp. had acquired Magellan Health in January 2022, to gain access to Magellan’s behavioral and specialty health programs. When the acquisition was announced in January 2021, it had a value of $2.2 billion.
Centene’s acquisition of Magellan Health created a behavioral health platform across 41 million members and added to Centene’s capability in government sponsored healthcare, bringing 5.5 million new members on government-sponsored plans. Magellan Health also provides specialty health services for 18 million third-party customers.
Separately, Centene announced it will sell PANTHERx Rare, a specialty and rare pharmacy, to a consortium of The Vistria Group, General Atlantic, and Nautic Partners. This acquisition is expected to be completed in two to four months. Centene expects to receive aggregate proceeds of about $2.8 billion from both transactions.
Last year, Centene had announced that it had planned leave the pharmacy benefit management space. The company said in a press release that it plans to use the proceeds to repurchase stock and reduce debt.