SXC, Catalyst announce merger as PBM market continues to consolidate

LISLE, Ill. — SXC Health Solutions and Catalyst Health Solutions on Wednesday announced a merger agreement under which SXC and Catalyst will combine in a cash and stock transaction valued at approximately $4.4 billion. The announcement comes some three weeks after Express Scripts and Medco consummated their $29.1 billion merger.

The transaction will join SXC’s pharmacy benefit management tools, technology and expertise with Catalyst’s local and collaborative client-centric PBM business model, creating a leading independent provider of PBM solutions, the companies stated. “This is an extremely compelling combination that brings together SXC’s industry-leading tools and technology with Catalyst’s full-service PBM, best-in-class service and growing client base to create a company that is even better positioned to compete in the marketplace,” stated Mark Thierer, chairman and CEO of SXC, who will continue in that role in the combined company.

Shareholders from both companies still need to approve the deal. If they do, SXC shareholders would own about 65% of the combined company, and Catalyst shareholders would own about 35%.

Upon completion of the transaction, the combined company will represent $13 billion in revenue. The combined company will cover approximately 25 million members, with annual prescription volume of more than 200 million adjusted PBM scripts.

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