Kroger to Merge with Axium Pharmacy
The Kroger Co. said it will acquire the outstanding shares of Lake Mary, Fla.-based Axium Pharmacy Holdings, Inc., a leading specialty pharmacy, to create a merger of the two companies.
"Kroger and Axium are a strategic fit as we look to enter the high-growth specialty pharmacy business," said Lincoln Lutz, Kroger's VP of 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."
Specialty pharmacy is the primary area of growth in pharmaceuticals, with revenue for specialty drugs having increased $87 Billion over the last decade. Last year, 80 percent of new drugs approved by the FDA were specialty drugs, with 700 currently in the pipeline for approval. Rodney McMullen, Kroger’s president and COO, noted that the "partnership supports Kroger's long-term growth plans, with strong return on invested capital," he said.
Mark Montgomery, Axium’s president and CEO, believes the merger will “create efficiencies that will reduce costs, drive growth and improve the overall quality of our combined healthcare services."
Axium will continue to operate as an independent company, led by Montgomery, within the Kroger family. The transaction is contingent on typical conditions of closing, including any required approval of regulatory authorities.
Cincinnati-based Kroger operates 2,425 supermarkets and multidepartment stores in 31 states under two dozen local banner names including Kroger, City Market, Dillons, Jay C, Food 4 Less, Fred Meyer, Fry's, King Soopers, QFC, Ralphs and Smith's.