DOCSLIB.ORG

Helena Foulkes Presentation

Total Page：16

File Type：pdf, Size：1020Kb

Download full-text PDF Read full-text
Helena Foulkes Presentation Capitalizing on the Retailization of Health Care Helena Foulkes Executive Vice President & President, CVS Pharmacy Agenda Retail Pharmacy Partnering Through Enterprise Capabilities Update on Key Assets Front Store Growth Strategy 2 RETAIL PHARMACY Retail Pharmacy at a Glance Estimated 2016 CVS Pharmacy Revenue 25% Front 75% Store Pharmacy 3 RETAIL PHARMACY Strong Record of Pharmacy Share Growth Over the Past Several Years CVS Pharmacy Share of Total U.S. Retail Prescriptions +300 bps 23.8% 20.8% 2013 Sep YTD 2016 Sep YTD 4 Refer to endnotes for additional information. RETAIL PHARMACY Significant Presence in the U.S. Retail Pharmacy Market Size and Scale • 9,600+ retail locations • More than 1.1B retail scripts filled annually We own the last mile through our unmatched patient touchpoints and high frequency of consumer interaction 5 Refer to endnotes for additional information. RETAIL PHARMACY A Strong Track Record of Leading Performance Medication Possession Ratio +580 +340 +610 bps bps bps 84.9 83.5 80.6 79.1 80.1 74.5 Diabetes Hypertension High-Cholesterol Top Competitors CVS Pharmacy We deliver best-in-class clinical outcomes to all patients 6 Refer to endnotes for additional information. RETAIL PHARMACY Our Success Is Driven by Integrating Clinical Programs Into Our Workflow System PATIENT CARE – GAP IN CARE An Integrated Approach Smith, John Phone Number: 123-456-7899 DOB: 01/01/1900 Age: 56 Years Gender: Male Txt Message: Not added Instructions: Confirm patient has gap in care and discuss reasons to close therapy • Our history with CVS Caremark gap. If creating prescriber request, always confirm the correct prescriber to contact with the patient. has focused us on outcomes Your pharmacist would like to speak with you today about a potential gap in your care • We have built clinical programs into our workflow If you have diabetes, its important to speak with your doctor about the best ways to manage your condition • Common long-term effects of diabetes can include reduced heart rate function • This ensures that performing • Statin therapy may help prevent this complication • Since we do not see a statin medication in your profile, we can contact your doctor to clinical programs is a key priority review this information • Your doctor will determine if a statin therapy is appropriate for you We are now leveraging these “clinical pipes” with other PBMs and health plans 7 RETAIL PHARMACY Continuing to Innovate in Our Patient Communications and Adherence Programs Pharmacy Innovation Team … and Has Developed Dozens of Focuses on … Programs, Including: Right Outreach Right Patient Mobile Insurance ScriptSync Rx Pickup Card Texts Right Medium Right Time Rx Mobile 30- to 90- Expiration In-store Day Switch Texts Beacons Texts We have a suite of personalized adherence tools to better deliver clinical programs 8 RETAIL PHARMACY ScriptSync Drives Adherence Through Improved Convenience Patients picking up multiple 73% 1.5M+ prescriptions per month can accept offer enrolled since now coordinate refills and to enroll launch improve adherence 6 percentage point lift in medication possession after enrollment Allows us to solve a consumer pain point AND provide added value to PBM and health plan partners 9 Refer to endnotes for additional information. Our Text Alerts Are Easier for Patients and Our Teams We are Driving Adoption … … and an Innovative, Integrated Experience Adherence text Your insurance Your Rx may Restock on-hand messages sent card is not on file have expired medications for back-to-school 600M 85% CAGR 175M Text us a photo Text us to contact Text us to refill 2014 2016E of your card your doctor your medication We own the last mile and understand our consumers 10 Refer to endnotes for additional information. RETAIL PHARMACY Because of Our Unique Capabilities, We Have Grown Faster Than the Market Growth in Prescriptions (2013 – 2016, Sep YTD) 27% Nearly 55% of our growth ~4X through Faster non-Caremark 7% payors CVS All Other Pharmacy Market 11 Refer to endnotes for additional information. RETAIL PHARMACY A Majority of Our Scripts Are Non-Caremark CVS Pharmacy Scripts by PBM (Oct 2016 YTD) Other PBMs 65% 35% CVS Caremark and Payors We are committed to partnering with other PBMs by leveraging the assets of CVS Health 12 Agenda Retail Pharmacy Partnering Through Enterprise Capabilities Update on Key Assets Front Store Growth Strategy 13 Bringing Together Assets From All of CVS Health to Win With PBMs and Health Plans Cost Retail Management Tools Long-term Mail Care Retail Clinics Specialty Clinical Programs Infusion Patients Medical Digital Claims Payors Providers Editing …enabling us to deliver superior outcomes at a lower cost 14 We Deployed Select Assets for a Non-PBM Medicaid Payor Seeking to Drive Cost Efficiencies and Retention Cost Retail Management Tools Long-term Mail Care Retail Clinics Specialty Clinical Programs Infusion Patients Medical Digital Claims Payors Providers Editing 15 Non-PBM Medicaid Payor Saw Improved Clinical Results Cost Retail Management• Retail marketing to support Tools Long-term member retentionMail Care Retail Clinics Specialty Clinical • Customized clinical pilots Programs leveraging in-store and Infusion telephonic capabilities • Emergency roomPatients diversion Medical Digital outreach program Claims Payors Providers Editing Closed gaps for patients at a rate 2X higher than client expectations 16 For Another Non-PBM Client, We Used Our Clinical Programs to Improve Star Ratings Cost Retail Management Tools Long-term Mail Care Retail Clinics Specialty Clinical Programs Infusion Patients Medical Digital Claims Payors Providers Editing 17 Non-PBM Client Achieved Improvements in Star Ratings Across Multiple Plans • AdherenceCost and refill opportunities Retail Management executedTools and enabled: Long-term Mail Care − ReadyFill and 90-Day Retail − Care 1-on-1 Retail Clinics Specialty Clinical • Clinical interventions and future initiatives: Programs Infusion − Client clinical rules engine − ScriptSync Patients − CVS Pharmacy Clinical call center Medical Digital Claims Payors Providers Editing Assisted plan in improving Star rating from 3 to 4 and achieved 4% increase in adherence 18 CVS Health Is Launching a Strategic Relationship With Optum Cost Retail Management Tools Long-term Mail Care Retail Clinics Specialty Clinical Programs Infusion Patients Medical Digital Claims Payors Providers Editing …enabling us to deliver superior outcomes at a lower cost 19 CVS Health Is Launching a Strategic Relationship With Optum Partnering to Offer Employers a Goal New Pharmacy Network Option • Fill 90-day scripts at any CVS Pharmacy or via OptumRx home delivery By continuing • Help improve consumer engagement and help health to partner with outcomes by leveraging CVS Pharmacy’s unmatched clinical other PBMs and capabilities health plans we • Going forward, Optum and CVS Pharmacy will continue will grow our to develop new pharmacy and health solutions leveraging prescription our suite of assets share 20 Agenda Retail Pharmacy Partnering Through Enterprise Capabilities Update on Key Assets MinuteClinic Omnicare Target Front Store Growth Strategy 21 MINUTECLINIC MinuteClinic Footprint Covers Most Populous U.S. Areas • Fully integrated 79 Target clinic locations • > 50% retail clinic market share • Approximately three times 1,136 larger footprint than closest Total Clinics competitor Clinic State MinuteClinic More than 50% of the U.S. population is within 10 miles of a MinuteClinic 22 Refer to endnotes for additional information. MINUTECLINIC MinuteClinic Enhances the CVS Value Proposition to Patients, Providers, Payors and PBMs Patient Engagement Low-Cost Care Population Health and Access • Up to 80% less expensive • Address gaps in care with Investing in: than other sites of care providers, payors and PBMs • Scheduling tools and • MinuteClinic Savings • Provide health risk walk-in options Strategy can further reduce assessments/biometric • Expansion of primary costs screenings care services • Electronic record integration • Telehealth with health systems 23 Agenda Retail Pharmacy Partnering Through Enterprise Capabilities Update on Key Assets MinuteClinic Omnicare Target Front Store Growth Strategy 24 OMNICARE Omnicare Has Significant Growth Opportunities Omnicare Opportunities Share of Prescriptions (Oct 2016 YTD) • Achieving operational excellence across Omnicare footprint Skilled Assisted living and • Rolling out industry-leading nursing other communities transitions experiences 76% 24% • Serving assisted living and independent living communities with new integrated capabilities 25 Refer to endnotes for additional information. OMNICARE We Have Applied CVS Operational Excellence Across the Omnicare Footprint STAT Fill Additional Operational Improvements • STAT Fill Services now leverage • New workflow and intake process for national CVS Pharmacy network for assisted living move-ins urgent medication needs • Technology upgrades and • 77% of Omnicare-served senior living investments including: communities are within three miles of a − Labor scheduling tools CVS Pharmacy − Prescribing enhancements to staff workflow 26 OMNICARE Investments in Transitions Enhances Our Market Positioning Acute care hospital Reinvented Goal of reducing medication admission transfer time from ten hours to experience two and a half hours Skilled nursing Residential home Transitions Diverting hospital readmissions of care through greater pharmacy care solution oversight These new services will further reduce hospital readmissions
Load more

Recommended publications
  • CVS Health Code of Conduct 1 CVS Health Code of Conduct 2 What We Stand For
    Code of Conduct Dear CVS Health® Colleagues Over the years CVS Health has built an outstanding reputation with our customers, colleagues and key stakeholders. Our reputation for superior customer service and excellence in execution, coupled with our high level of integrity and sound business practices have helped us build a solid foundation of trust. This foundation is a valuable asset that has taken years to build, and is vital to our long-term success. As we look toward the future, we remain steadfast in our commitment to doing the right things in the right way, complying with laws and regulations and never compromising our standards. As you go about your day-to-day work and deal with challenging issues, I encourage you to refer to our Code. The Code was designed to help establish appropriate “rules of the road” for colleagues looking for the right solutions to ethical questions or issues and in obtaining additional guidance when the correct path is not clear. Each of your decisions and actions shape our reputation at CVS Health. That is why we must all commit to act with integrity while meeting our responsibilities. The Code is an excellent guide to doing the right thing, but it is not a substitute for good judgment, nor can it address every issue. So where there is no written rule or precedent, decisions need to be consistent with our company’s Purpose, Strategy and Values, which represent our guiding principles as an organization. In doing so we will continue to earn the trust that our stakeholders have placed in us.
    [Show full text]
  • CVS Health Corporation Corporate Integrity Agreement
    CORPORATE INTEGRITY AGREEMENT BETWEEN THE OFFICE OF INSPECTOR GENERAL OF THE DEPARTMENT OF HEALTH AND HUMAN SERVICES AND CVS HEALTH CORPORATION I. PREAMBLE CVS Health Corporation and its subsidiaries (collectively, “CVS Health”) hereby enters into this Corporate Integrity Agreement (CIA) with the Office of Inspector General (OIG) of the United States Department of Health and Human Services (HHS) to promote compliance with the statutes, regulations, and written directives of Medicare, Medicaid, and all other Federal health care programs (as defined in 42 U.S.C. § 1320a-7b(f)) (Federal health care program requirements). CVS Health is an integrated pharmacy services health care provider engaged in certain business lines that do business with Federal health care programs. Except as otherwise specified herein, the terms of this CIA shall apply to Omnicare, Inc. and its operating subsidiaries, which is CVS Health’s business line of institutional pharmacy services operations (“IPS Operations”), as defined in Section II.C.1, below. Effective August 18, 2015, CVS Health acquired Omnicare, Inc. Contemporaneously with this CIA, Omnicare, Inc. is entering into a Settlement Agreement with the United States. In consideration of the obligations of CVS Health in this CIA and the obligations set forth in the settlement agreement entered into among the United States of America, acting through the United States Department of Justice and on behalf of the OIG-HHS; Omnicare, Inc.; NCS Healthcare, LLC; NeighborCare, Inc.; and Relators Donald Gale and Marc Silver on June 25, 2014 (hereinafter “2014 Omnicare Settlement Agreement”), OIG agrees to release and refrain from instituting, directing, or maintaining any administrative action seeking exclusion from Medicare, Medicaid, and all other Federal health care programs (as defined in 42 U.S.C.
    [Show full text]
  • Net Lease Pharmacy Report March 2018
    Net Lease Pharmacy Report March 2018 NET LEASE PHARMACY INDUSTRY OVERVIEW CVS and Walgreens are the market leaders in the U.S. drugstore industry accounting for more than half of the market share in top metropolitan areas. Over the years, drugstores have evolved into all- encompassing health service providers and as a result have strategically positioned themselves to diversify their portfolios by acquiring key competitors and forging partnerships to protect themselves from growing online threat. Industry demand is driven by an aging population, health issues, and ad- vances in medical treatment. Drugstores rely heavily on their prescription business, which has grown over the years, however same store comparables for front of store sales have decreased. Total 2017 retail sales for prescription drugs filled at pharmacies surpassed $397B* and are speculated to have been upwards of $426B. *Data based on QuintilesIMS National Prescription Audit (NPA) database. Includes new prescriptions and refills of both brand/generic. Source: Kaiser Foundation Definitions Pharmacy Benefits Managers (PBM): Third party companies that provide healthcare management and administration services to insurance companies, Medicare Part D plans, state government employee plans and corporations. e.g. CVS Caremark, Express Scripts. PBMs lever- age economies of scale by negotiating drug prices with drug makers and pharmacies on behalf of larger groups of customers. Chad M. Firsel Daniel Waszak Jason Caplan Zack Hilgendorf Jack Farritor President Senior Vice President Senior Vice President Vice President Vice President 312.269.0220 312.269.0550 312.533.2347 312.533.2348 312.683.9924 [email protected] [email protected] [email protected] [email protected] [email protected] Quantum Real Estate Advisors, Inc.
    [Show full text]
  • 1 United States District Court Southern
    UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK ) _____ Individually and On Behalf of All ) Others Similarly Situated, ) Case No. ) Plaintiff, ) ) CLASS ACTION COMPLAINT v. ) ) ) CVS HEALTH CORPORATION, LARRY J. ) JURY TRIAL DEMANDED MERLO, and DAVID M. DENTON, ) ) ) Defendants. ) ) Plaintiff_____ (“Plaintiff”), individually and on behalf of all other persons similarly situated, by Plaintiff’s undersigned attorneys, for Plaintiff’s complaint against Defendants, alleges the following based upon personal knowledge as to Plaintiff and Plaintiff’s own acts, and information and belief as to all other matters, based upon, inter alia, the investigation conducted by and through Plaintiff’s attorneys, which included, among other things, a review of the Defendants’ public documents, conference calls and announcements made by Defendants, United States Securities and Exchange Commission (“SEC”) filings, wire and press releases published by and regarding CVS Health Corporation (“CVS Health” or the “Company”), analysts’ reports and advisories about the Company, and information readily obtainable on the Internet. Plaintiff believes that substantial evidentiary support will exist for the allegations set forth herein after a reasonable opportunity for discovery. NATURE OF THE ACTION 1. This is a federal securities class action on behalf of a class consisting of all persons other than Defendants who purchased or otherwise acquired CVS Health securities between May 21, 2015 and February 20, 2019, both dates inclusive (the “Class Period”), seeking to recover 1 damages caused by Defendants’ violations of the federal securities laws and to pursue remedies under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Rule 10b-5 promulgated thereunder, against the Company and certain of its top officials.
    [Show full text]
  • CVS Digital Capabilities
    Digital Capabilities Connecting members, patients and customers to our services anytime, anywhere. Table of Contents Our Digital Strategy ............... 4 Helping people save CVS Caremark® ...................... 6 time, save money CVS Specialty® ....................... 8 Omnicare® and and stay healthy. Medicare Part D ................... 10 CVS Pharmacy® and Here at CVS Health, we’re reinventing pharmacy to help people on their CVS MinuteClinic™ ............... 12 path to better health. Our commitment to digital innovation is one way we’re putting our purpose into action. Front Store ............................ 14 Throughout all of our service brands, we offer members, patients and customers a suite of digital tools that make managing their health more accessible, more intuitive and more integrated across all our channels. Moving forward, we’ll continue to transform the future of health care by redefi ning convenience and improving the health outcomes of millions of people. 2 3 Build Develop the ultra-convenient, fully integrated pharmacy Our experience only CVS Health can provide across our service brands (CVS Pharmacy, Digital CVS MinuteClinic, CVS Caremark, Strategy CVS Specialty and Omnicare). Digital tools are Personalize transforming the way Provide individualized customer consumers shop and interactions, leveraging data across manage their health care. all touch points to help members, patients and customers on their We’re responding to path to better health. these changing needs by differentiating the customer experience through three Innovate strategic pillars. Harness critical digital trends through rapid testing/learning/ iteration and third-party collaboration at the CVS Health Digital Innovation Lab. 4 5 Member Set Up Print Rx History Easy Refill Makes budgeting and tax prep Offers members a simple way Early Registration easier by allowing members to to refill by scanning the barcode Allows members to register and print a list of prescription costs.
    [Show full text]
  • View Annual Report
    We are transforming health care. We are lowering costs. We are making it simple. We are doing even more. We are improving engagement. We are supporting communities. We are CVS Health. 2018 Annual Report We are transforming health care. CVS Health is well positioned to engage patients and tackle a system whose challenges have resulted in unnecessary spending and suboptimal outcomes. For many, our company name remains uniquely powerful platform that will our programs and services into their synonymous with the nearly 10,000 open a new front door to health care existing routines. retail locations we operate across the and reshape the consumer experience. The current system drives patients to United States. Today’s CVS Health is, Three strategic imperatives guide our be health care decision makers, but of course, so much more than that. transformation efforts: be local, make they lack the tools needed to navigate CVS Caremark® makes us the nation’s health care simple, and improve health. effectively. We’re going to change that largest pharmacy benefits manager, and CVS Health offers more consumer and help guide patients along their we are also the leader in retail clinics, touchpoints than any other health health care journeys by providing more specialty pharmacy, and infusion. care company, and this enables us convenient access to the information, With our recent acquisition of Aetna®, to offer care where, when, and how resources, and services they need. And CVS Health operates one of the nation’s patients need it—in the community, by aligning the capabilities of Aetna premier health benefits companies in the home, or even in the palm of with our consumer-centric assets, as well.
    [Show full text]
  • ANNUAL REPORT PURSUANT to SECTION 13 OR 15(D)
    UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) ☑ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2020 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from _________ to_________ Commission file number: 001-01011 CVS HEALTH CORPORATION (Exact name of registrant as specified in its charter) Delaware 05-0494040 (State or other jurisdiction of incorporation or organization) (I.R.S. Employer Identification No.) One CVS Drive, Woonsocket, Rhode Island 02895 (Address of principal executive offices) (Zip Code) Registrant’s telephone number, including area code: (401) 765-1500 Securities registered pursuant to Section 12(b) of the Act: Title of each class Trading Symbol(s) Name of each exchange on which registered Common Stock, par value $0.01 per share CVS New York Stock Exchange Securities registered pursuant to Section 12(g) of the Act: None Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. ☑ Yes ☐ No Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. ☐ Yes ☑ No Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
    [Show full text]
  • Aetna CVS Joint Proxy Statement Prospectus
    MERGER PROPOSAL—YOUR VOTE IS VERY IMPORTANT February 9, 2018 Dear CVS Health Stockholders and Aetna Shareholders: On behalf of the boards of directors of CVS Health and Aetna, we are pleased to enclose the joint proxy statement/prospectus relating to the merger of Aetna with a wholly-owned subsidiary of CVS Health pursuant to the terms of a merger agreement entered into by CVS Health and Aetna on December 3, 2017. If the merger is completed, Aetna shareholders immediately prior to the effective time of the merger will be entitled to receive $145.00 in cash and 0.8378 of a share of CVS Health common stock for each Aetna common share held by them, as described in more detail in the accompanying joint proxy statement/prospectus under the heading “The Merger Agreement—Merger Consideration.” Based on the closing price of a share of CVS Health common stock on February 8, 2018, the most recent trading day prior to the date of the accompanying joint proxy statement/prospectus for which this information was available, the merger consideration represented approximately $204.11 in value per Aetna common share. The value of the consideration to be received by Aetna shareholders will fluctuate with changes in the price of the shares of CVS Health common stock. We urge you to obtain current market quotations for shares of CVS Health common stock and Aetna common shares. Shares of CVS Health common stock and Aetna common shares are traded on the New York Stock Exchange (NYSE) under the symbols “CVS” and “AET”, respectively. In connection with the merger, CVS Health stockholders are cordially invited to attend a special meeting of the stockholders of CVS Health to be held on March 13, 2018 at the offices of Shearman & Sterling LLP, located at 599 Lexington Avenue, New York, NY 10022, at 11:00 a.m.
    [Show full text]
  • Creating Value by Transforming the Consumer Health Experience
    Creating Value by Transforming the Consumer Health Experience Larry Merlo President & Chief Executive Officer Cautionary statement regarding forward-looking statements The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements made by or on behalf of CVS Health Corporation. By their nature, all forward-looking statements involve risks and uncertainties. Actual results may differ materially from those contemplated by the forward-looking statements for a number of reasons as described in our Securities and Exchange Commission filings, including those set forth in the Risk Factors section and under the section entitled “Cautionary Statement Concerning Forward-Looking Statements” in our most recently filed Annual Report on Form 10-K and Quarterly Report on Form 10-Q. The presentations at our 2019 Investor Day include non-GAAP financial measures that we use to describe our company’s performance. In accordance with SEC regulations, you can find the definitions of these non-GAAP measures, as well as reconciliations to most comparable GAAP measures, on the Investor Relations portion of our website. Link to our non-GAAP reconciliations. 2 Today’s Objectives Strength of our businesses and how they provide a foundation for transformation How we intend to dramatically improve the way health care is delivered in the U.S. Our expectations for 2020 / 2021 and our positioning for long-term growth How current investments will translate into increased shareholder value 3 Agenda Key trends in health care Well
    [Show full text]
  • Form a Application of CVS Health Corp. for Acquisition of Aetna Better
    Exhibit 4-B Item 1 of CVS Health's 2015 Annual Report on Form 10-K PART I Item I. Business Overview CVS Health Corporation, together with its subsidiaries (collectively "CVS Health," the "Company,'' "we," "our" or ''us"), is a pharmacy innovation company helping people on their path to better health. At the forefront of a changing health care landscape, the Company has an unmatched suite of capabilities and the expertise needed to drive innovations that will help shape the future of health. We arc currently the only integrated pharmacy health care company with the ability to impact consumers, payors, and providers with innovative, channel-agnostic solutions to complex challenges managing costs and care. We have a deep understanding of their diverse needs through our unique integrated model, and we arc bringing them innovative solutions that help increase access to quality care, deliver better health outcomes, and lower overall health care costs. Through our approximately 9,600 retail phamrncics. more than I, I 00 walk-in medical clinics, a leading pharmacy benefits manager with more than 75 million plan members, a dedicated senior pharmacy care business serving more than one million patients per year, and expanding specialty pharmacy services, we enable people, businesses, and communities to manage health in more affordable, effective ways. We arc delivering break­ through products and services, from advising patients on their medications at our CVS Pharmacy" locations, to introducing unique programs to help control costs for our clients at CVS Caremark". to innovating how care is delivered to our patients with complex conditions through CVS Specialty"', to improving pharmacy care for the senior community through Omnicare•, or by expanding access to high-quality, low-cost care at CVS MinuteClinic"'.
    [Show full text]
  • Competition Issues in the Distribution of Pharmaceuticals
    Unclassified DAF/COMP/GF/WD(2014)43 Organisation de Coopération et de Développement Économiques Organisation for Economic Co-operation and Development 10-Feb-2014 ___________________________________________________________________________________________ English - Or. English DIRECTORATE FOR FINANCIAL AND ENTERPRISE AFFAIRS COMPETITION COMMITTEE Unclassified DAF/COMP/GF/WD(2014)43 Global Forum on Competition COMPETITION ISSUES IN THE DISTRIBUTION OF PHARMACEUTICALS Contribution from the United States -- Session III -- This contribution is submitted by the United States under Session III of the Global Forum on Competition to be held on 27-28 February 2014. Ms Cristiana Vitale, Senior Competition Expert, OECD Competition Division Tel: +33 1 45 24 85 30, Email: [email protected] English - Or. English JT03352197 Complete document available on OLIS in its original format This document and any map included herein are without prejudice to the status of or sovereignty over any territory, to the delimitation of international frontiers and boundaries and to the name of any territory, city or area. DAF/COMP/GF/WD(2014)43 COMPETITION ISSUES IN THE DISTRIBUTION OF PHARMACEUTICALS -- United States -- Introduction 1. The U.S. Federal Trade Commission and the Antitrust Division of the U.S. Department of Justice are pleased to provide this paper in response to the OECD’s call for contributions to the Global Forum on Competition Roundtable regarding competition issues in the distribution of pharmaceuticals. 2. The Federal Trade Commission (FTC or Commission) and the Antitrust Division (collectively, the Agencies) are the federal government enforcers of U.S. competition laws. In addition, the Agencies seek to influence competition policy and promote competitive practices through study of markets and marketing practices (including conducting workshops and publishing reports); through advocacy of competition policy to the U.S.
    [Show full text]
  • October/November 2014 Mergers and Acquisitions in U.S. Retail Pharmacy
    October/November 2014 Mergers and Acquisitions in U.S. Retail Pharmacy PengCheng Zhu, Ph.D., CFA Assistant Professor of Finance School of Business Administration University of San Diego Peter E. Hilsenrath, Ph.D. Joseph M. Long Chair in Healthcare Management and Professor of Economics Eberhardt School of Business Thomas J. Long School of Pharmacy & Health Sciences University of the Pacific Journal of Health Care Finance www.HealthFinanceJournal.com Mergers and Acquisitions in U.S. Retail Pharmacy Abstract The retail pharmacy industry is the primary source of prescription medication for Americans. It has transformed away from a cottage industry of independent pharmacies and consolidated toward chain drug stores and mail order. This trend, its causes and consequences, are not fully understood. We use secondary data to study a sample of 87 large acquisitions in the industry. Findings indicate that in spite of rapid growth, profitability eroded. Stock investors respond positively to merger and acquisition announcements for both acquiring and acquired firms and negatively for rival firms not party to such transactions. We also show that the concentration of the retail pharmacy industry is negatively correlated with producer prices and positively correlated with profitability. Our findings are consistent with a view that retail pharmacies are merging to create countervailing power for bargaining leverage with other parties in the supply chain. The capital market perceives these mergers positively and shareholders benefit from these transactions. 2 I. INTRODUCTION There has been considerable scholarly interest in the pharmaceutical industry with focus on relatively high prices and profit margins as well as mergers and acquisitions (M&A’s) (Berndt, 2002; Danzon et al., 2012).
    [Show full text]