Mag­el­lan Health Ser­vices buys CDMI, plans to ex­pand pharma man­age­ment arm

Modern Healthcare - - REGIONAL NEWS - —Rachel Lan­den

Mag­el­lan Health Ser­vices, Avon, Conn., an­nounced plans this week to ac­quire CDMI, a pri­vately held New­port, R.I.-based provider of clin­i­cal con­sult­ing pro­grams that also ne­go­ti­ates and ad­min­is­ters drug re­bates for man­aged care or­ga­ni­za­tions and other clients.

Ac­qui­si­tion of CDMI is ex­pected to en­hance Mag­el­lan’s clin­i­cal pro­grams and out­reach ser­vices for man­ag­ing chronic con­di­tions, as well as broaden its Mag­el­lan Rx Man­age­ment clin­i­cal spe­cialty drug and med­i­cal man­age­ment sup­port ca­pa­bil­i­ties. It will also cre­ate op­por­tu­ni­ties to grow and scale the busi­ness by tap­ping into CDMI’s ex­ist­ing cus­tomer base, ac­cord­ing to a com­pany re­lease.

Founded by phar­macy ex­ec­u­tives in 2009, CDMI works with more than 30 health plans and had net rev­enues of about $43 mil­lion in 2013. Ge­orge Petrovas, CDMI’s co­founder and ex­ec­u­tive vice pres­i­dent, will move into the role of CDMI pres­i­dent, which will op­er­ate un­der Mag­el­lan Rx Man­age­ment.

“CDMI and Mag­el­lan Rx Man­age­ment have sim­i­lar cul­tures and a per­sis­tent fo­cus on their cus­tomers. I’m pleased that we’ll be join­ing Mag­el­lan dur­ing this ex­cit­ing pe­riod of growth,” Petrovas said in a re­lease. “CDMI’s clin­i­cal prod­ucts, ser­vices and re­la­tion­ships will sup­ple­ment Mag­el­lan Rx Man­age­ment’s suite of in­dus­trylead­ing phar­macy of­fer­ings and prod­ucts, as we work to­gether to grow this busi­ness.”

Mag­el­lan has agreed to pay $205 mil­lion for CDMI—$125 mil­lion in cash and $80 mil­lion to be rein­vested in Mag­el­lan re­stricted com­mon stock by CDMI’s prin­ci­pal own­ers and cer­tain key man­age­ment. There is also up to an additional $165 mil­lion avail­able in po­ten­tial con­tin­gent pay­ments. Sub­ject to cus­tom­ary clos­ing con­di­tions, the trans­ac­tion is ex­pected to be com­pleted in the sec­ond quar­ter of 2014.

Newspapers in English

Newspapers from USA

© PressReader. All rights reserved.