WisconsinRx, CVS Caremark: Extend partnership to benefit employer plans

For more information, please contact:

Melissa Duffy, 608-334-0624

melissa.duffy@charter.net

Contract agreement latest in string of successes for the pharmacy benefit coalition

2010 has been a landmark year for WisconsinRx, a Wisconsin-based pharmacy benefit purchasing collaborative owned by employers and labor organizations across the U.S. The company recently mailed sizeable rebate and dividend checks to members, and now has extended its Pharmacy Benefit Management (PBM) contract with CVS Caremark, the largest pharmacy health care provider in the United States.

The two companies agreed to improved pricing terms for WisconsinRx members beginning January 1, 2011. The new contract with Caremark will also bring significant long-term savings as it includes annual pricing improvements in subsequent years.

“WisconsinRx was created by employer and labor organizations to put experts on the front lines of a very complicated pharmacy benefits industry,” said Greg Horstman, CEO of WisconsinRx. “As we add new members, we expect our plans to reap new and greater benefits from being part of an ever-growing purchasing coalition. That is why we never stop negotiating better pricing and added value on behalf of our members. This improved pricing will certainly accentuate our five year average pharmacy trend that has been reduced by nearly one percent per year.”

WisconsinRx’s steady growth also resulted in a larger dividend paid out to members for the fourth year in a row. Because WisconsinRx is a cooperative owned by the employers and organizations that provide employee pharmacy benefits through the coalition, member plans receive a dividend when the cooperative’s income exceeds expenses.

These “patronage” dividends are paid to WisconsinRx members in addition to guaranteed minimum rebates that are part of the financial agreement with CVS Caremark. In the most recent one-year period, plan sponsors that are member-owners of WisconsinRx collectively received more than $8.4 million in combined rebates and patronage dividends as a result of their membership in WisconsinRx.

Horstman said the amounts show the value of cooperative purchasing of pharmacy benefits. “Our plans achieve this because they work together as a coalition,” Horstman said. “And because they own our not-for-profit company, it all goes directly to their benefit.”

More About WisconsinRx

WisconsinRx was founded seven years ago by three Wisconsin-based employer coalitions looking to control overall drug spend, make better decisions with better data and gain access to transparent information about pharmacy management. It is cooperatively owned and governed by member organizations that have a vested interest in the success of Wisconsin’s economy.

During a time when national pharmacy cost trend increased ten to twelve percent annually, WisconsinRx members have benefitted from average annual cost increases of just 1.3 percent. The coalition operates nationally through its National CooperativeRx subsidiary.