NERA Economic Analysis Played Role in Medco's Acquisition by Express Scripts

03 May 2012

New York -- On 25 April 2012, US District Court Judge Cathy Bissoon denied a motion by the National Association of Chain Drug Stores and other pharmacy groups and retail pharmacies to block the acquisition of Medco Health Solutions by Express Scripts. The transaction had already been approved by the US Federal Trade Commission (FTC) on 2 April 2012 after an eight-month investigation. Medco and Express Scripts are two of the three largest US pharmacy benefit managers (PBMs).

Economists at NERA Economic Consulting provided advice to counsel for Medco prior to the transaction and during the FTC’s investigation. NERA’s work on behalf of Medco focused on analyses of Medco's historical sales and competitive bidding data. Analyses of these and other market data by NERA's team, led by Senior Vice Presidents Dr. Lawrence Wu and Dr. Thomas McCarthy, were particularly informative about the likely competitive effects of the transaction.

"As noted by the FTC, the bidding data produced by Medco, Express Scripts, and other third parties demonstrated that Medco and Express Scripts were not particularly close competitors and that other competitors have been successful in winning business away from the merging parties," said Dr. Wu. "These and other analyses were central to the FTC’s conclusion that the market for PBM services was competitive and that the transaction would not have an adverse effect on the competitive dynamics."

For more information about NERA's role in Medco's acquisition by Express Scripts, please visit NERA's Antitrust and Corruption practice.

About NERA

NERA Economic Consulting ( is a global firm of experts dedicated to applying economic, finance, and quantitative principles to complex business and legal challenges. For more than six decades, we have been creating strategies, studies, reports, expert testimony, and policy recommendations for government authorities and the world’s leading law firms and corporations. We bring academic rigor, objectivity, and real-world industry experience to issues arising from competition, regulation, public policy, strategy, finance, and litigation.

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