CVS Health is expanding its business into the long-term healthcare market with the acquisition of Omnicare, a provider of pharmacy services to long-term care facilities.
CVS is spending $12.7 billion to buy Omnicare.
According to the company, the purchase will make it easier for CVS to deliver pharmacy services to long-term care and assisted living facilities, which serve the elderly. Also, by purchasing Omnicare, which has a well established specialty pharmacy business and clinical expertise, it will enable CVS to expand in that area.
Omnicare has about 13,000 employees working at 160 places in 47 states. CVS said the acquisition will allow the company to offer better coordinated care across a range of settings, from retail to long-term care, which ultimately will benefit consumers, patients, caregivers, and insurers. CVS also claims the acquisition will improve outcomes because patients will be able to receive greater continuity of care as they move through various settings in the healthcare system.
The purchase of Omnicare is a major growth opportunity for CVS, the company said, because of the increasing number of people who will be moving into long-term care situations as the baby boomers age.
Some industry analysts echoed the company’s claims that the purchase will result in increases in efficiency. CVS will now be able to offer greater continuity as patients move back and forth between long-term care facilities and their homes, because the company will be able to offer services in both of these areas.
CVS, analysts said, has a solid record of improving health outcomes at low costs, and so the combination of both companies should help to close current gaps in care.
“The acquisition of Omnicare significantly expands our business, providing CVS Health access into a new pharmacy dispensing channel,” CVS Health President and CEO Larry Merlo said in a statement. “It also creates new opportunities for us to extend our high-quality, innovative pharmacy programs to a broader population of seniors and chronic care patients as they transition across the care continuum. We have been impressed by the Omnicare team and what they have created for the patients they serve.”
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