NEW YORK, April 21 /PRNewswire-FirstCall/ -- With scale across both mail and retail pharmacy operations, re-organized and re-energized customer-facing groups, and profound and proprietary technology advantages, Medco Health Solutions, Inc., is well-positioned to lead the pharmacy benefit management industry on behalf of its customers, executives today told shareholders at the company's inaugural annual meeting since its August 2003 spin-off.
"During 2003, we successfully completed our spin-off, improved our operational performance, met our financial targets, and increased shareholder value. In 2004 and beyond, our focus is on the customer," said David B. Snow Jr., Medco chairman, president and CEO. "Intent on building an enduring level of client satisfaction, we are re-orienting our company's systems, services and organizations to support a customer-first culture."
Snow added: "From a business perspective, financially, organizationally, and operationally we are well-positioned to capture opportunities by driving industry leadership in generics, mail order and specialty pharmacy. Additionally, the soon-to-be-implemented Medicare modernization initiative extends to America's seniors our proven abilities to lower drug costs and increase the quality and safety of prescription healthcare."
Focus on the Customer
Medco has reorganized its sales and account teams into four strategic areas -- each of which has end-to-end support capabilities and is empowered to meet the unique challenges and requirements of customers within their served markets: large accounts, government/labor, health care organizations and small-to-mid-sized businesses.
Beyond the organizational re-alignment, the company has also made investments to address several critical client requests: providing desktop access to detailed drug plan modeling and management tools; offering real-time problem-solving capabilities; delivering greater program flexibility; increasing operational precision; and enhancing business transparency.
As examples, Snow highlighted:
* EXPERxT Advisor: A proprietary, interactive desktop "dashboard," that
helps to deliver financial transparency directly to the client via the
desktop. EXPERxT Advisor provides clients with real-time access to
sophisticated data analysis, alerts, and modeling tools that enable
customers to evaluate and actively manage their prescription drug plans
with a higher degree of predictability and confidence. EXPERxT Advisor
pilots begin a limited rollout next month.
* Client Solutions Centers: Medco is installing a series of industry-
specific customer solutions centers in its Franklin Lakes, N.J.
headquarters and will place interactive audio/video capabilities in
many of its customer locations to provide live and frequent access to
Medco's senior executives, clinicians, financial analysts and other
experts to both explore opportunities and issues that arise in the
client relationship. The high-tech solution centers enable a greater
depth, breadth -- and frequency -- of customer contact to quickly
address virtually any issue at any time.
* Systems Flexibility: Medco has re-engineered the software construction
and testing processes that support its business companywide in
activities as varied as installing new clients to managing plan design
changes to ensuring patient privacy. The result has already been
manifest in the near-flawless execution of an increased number of
first-quarter software releases supporting client plan changes.
Significant Opportunities
During his address to shareholders, Snow also outlined opportunities enabled by the company's scale, focus and technology advantages, including:
* Mail Order: Medco's mail order pharmacies fill more prescriptions than
its two largest PBM competitors combined. Over the past year,
enrollment in programs that require the use of Medco's lower-cost mail
order pharmacies for certain prescriptions has more than doubled to
4.8 million lives -- yet represents a small fraction of the total
number of users of maintenance medications across the company's book of
business. In 2003, Medco's two state-of-the-art automated pharmacies
dispensed 93 percent of the company's 78 million mail order
prescriptions.
* Generics: Medco is already one of the nation's largest purchasers of
generic medicines, and drugs with tens of billions of dollars in annual
sales are expected to lose patent protection over the next four years.
The company increased its 2003 generic dispensing rate by 3 percentage
points to 44 percent.
* Specialty pharmacy: Medco's specialty pharmacy program, which handles
expensive medications used to treat complex diseases, grew from a base
of 200,000 covered members early in 2003 to 6.5 million lives a year
later.
Medicare Moves to Market
In an initiative that moved from concept to market in a matter of months, Medco has recently been selected by the federal government's Centers for Medicare and Medicaid Services (CMS) as one of 28 Medicare-approved prescription discount card sponsors. Additionally, nine Medco clients have decided to co-brand Medco's Medicare-approved prescription discount card program -- representing an opportunity for the company to assist one of the largest groups of underserved Americans.
"For too long, America's seniors have been among the last groups in America forced to pay full retail for their prescription medicines. Beginning in June, millions served by Medicare will have equal access to what is, effectively, wholesale pricing," said Snow.
Enrollment for the discount card program begins May 3. Medco expects that its Medicare discount card programs will save Medicare beneficiaries, on average, up to 30 percent or more on their prescription drugs. Savings could be as much as 50 percent by using generic medications or by using Medco's mail order pharmacy.
Shareholders Overwhelmingly Endorse Board Directors, Auditors
During the business portion of the annual meeting, shareholders in overwhelming votes elected Snow, Howard "Skip" Barker and Dr. Brian Strom as Class I directors, with terms of service extending to the annual meeting in 2007. Except Snow, each member of the company's board of directors is considered independent.
Shareholders also ratified the appointment of PricewaterhouseCoopers LLP as independent auditors for Medco for its fiscal year ending Dec. 25, 2004.
The company is scheduled to announce its First Quarter 2004 earnings on April 27.
About Medco
Medco Health Solutions, Inc., a leading pharmacy benefit manager with the nation's largest mail order pharmacy operations, assists its customers to moderate the cost and enhance the quality of prescription drug benefits provided to members nationwide. Its customers include private- and public-sector employers and healthcare organizations. Medco is traded on the New York Stock Exchange under the symbol MHS. On the Net: http://www.medco.com/.
This press release contains "forward-looking statements" as that term is defined in the Private Securities Litigation Reform Act of 1995. These statements involve risks and uncertainties which may cause results to differ materially from those set forth in the statements. No forward-looking statement can be guaranteed, and actual results may differ materially from those projected. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future events, or otherwise. Forward-looking statements in this presentation should be evaluated together with the risks and uncertainties that affect our business, particularly those mentioned in the Risk Factors section of the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission.
Medco Health Solutions, Inc.CONTACT: Investors: Susan DeWitt, +1-201-269-6187,susan_dewitt@medco.com, Media: Jeffrey Simek, +1-201-269-6400,jeffrey_simek@medco.com, both of Medco Health Solutions, Inc.
Web site: http://www.medco.com/
