Even though Express Scripts is being acquired by insurance giant Cigna, the St. Louis County-based company will keep its name and continue marketing and branding under the Express Scripts moniker, according to details included in a merger proxy filed Wednesday.
In March it was announced that Express Scripts, the largest public company to ever call St. Louis home, was being sold to health insurer Cigna in a $67 billion deal. When the deal was announced, many details were not disclosed about how the new companies would operate after the merger finalizes.
On Wednesday, the two released terms of the deal that reiterated plans to keep Express Scripts’ operations in the St. Louis region, while the combined company’s headquarters will be in Bloomfield, Conn., where Cigna is based.
Tim Wentworth, 57, will stay on and lead Express Scripts as president, reporting to David Cordani, CEO of Cigna, as previously announced.
Express Scripts is one of the nation’s largest pharmacy benefit managers, providing prescription drugs to millions of Americans.
Under terms of the deal, four of Express Scripts’ current board members will be seated on the combined company’s 13-member board: William DeLaney, retired CEO of Sysco Corp.; Elder Granger, president, CEO of The 5Ps LLC; Kathleen Mazzarella, chairman, president, CEO of Graybar Electric Co.; and William Roper, CEO of UNC Health Care System.
- George Paz, the former longtime CEO and current board chair, will not serve on the board of the combined company, according to the filing.
- Employees can expect to retain their current wages. The combined company will “honor all Express Scripts benefit plans and compensation arrangements,” according to the filing.
- Express Scripts employs 4,687 people in the region and 26,600 worldwide.
The deal is pending approval from shareholders and is under review by the Department of Justice.
If the deal is terminated, either party could owe a fee of either $2.1 billion or $1.6 billion depending on the reason for the breakup, according to the filing.
Express Scripts was founded in the area in 1986, and grew into a behemoth in the health care industry, generating more than $100 billion in annual revenue.
Express Scripts had long touted its benefits as a standalone company, and its acquisition raises questions about the long-term viability of independent pharmacy benefit managers.
The company’s competitors are all hitched to other entities. For example, CVS Caremark, another pharmacy benefits manager, is part of CVS Health, which operates retail clinics inside its chain of drugstores. And Optum is part of the insurance giant UnitedHealth.
Leading up to the deal between Express Scripts and Cigna, the health care industry was quickly changing with an impending merger between CVS and Aetna and reports of Amazon entering the industry.