Kroger announces merger with specialty pharmacy Axium Pharmacy
CINCINNATI — Kroger on Thursday announced it will acquire the outstanding shares of Axium Pharmacy Holdings, a leading specialty pharmacy, and merge the two companies.
The partnership gives Kroger significantly enhanced capabilities to serve customers who require complex drug therapies, and to deliver those therapies at a greater value to customers and insurance payers, the grocer stated. Financial terms were not disclosed.
"Kroger and Axium are a strategic fit as we look to enter the high-growth specialty pharmacy business," stated Lincoln Lutz, Kroger VP corporate pharmacy. "The combination of Axium's expertise and Kroger's 1,950 pharmacy locations, 91 Little Clinic locations and pharmacists who provide health coaching, biometric screening and other wellness services will deliver positive health outcomes for our patients, cost savings for insurance payers and unique services for physicians."
"We are excited to partner with Kroger to deliver specialty pharmacy services to their customers," added Mark Montgomery, Axium's president and CEO. "We believe this relationship will create efficiencies that will reduce costs, drive growth and improve the overall quality of our combined healthcare services."
Founded in 2000, Axium provides drug therapies and patient-support services to treat chronic, genetic and other complex medical conditions, such as cancer, hepatitis C, rheumatoid arthritis, multiple sclerosis and numerous other chronic care conditions.
In a press release announcing the merger, Kroger noted that specialty pharmacy is the primary area of growth in pharmaceuticals. Revenue for specialty drugs has grown from $17 billion in 2000 to $104 billion in 2011, and is projected to grow to $135 billion in 2014. In 2011, 80% of new drugs approved by the FDA were specialty drugs. Currently, more than 700 specialty drugs are in the pipeline for approval.
The transaction is contingent on typical conditions of closing, including any required approval by regulatory authorities. Edge Healthcare Partners served as Axium's financial adviser for the pending merger.