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Right Aid enters pharmacy benefit business market

Rite Aid Corp., a drugstore operator, agreed to acquire pharmacy benefit manager EnvisionRx for $2 billion. The company is looking to cut drug procurement costs as reimbursement rates fall. Shares for Rite Aid jumped as much as 12% in heavy trading on Wednesday.

Pharmacy benefit managers administer drug benefits for employers and health plans and run large mail order pharmacies, which helps them get better prices from drugmakers. Rite Aid’s Chief Executive John Standley said, “The synergy between our companies are going to be driven, we hope, by revenue growth primarily.” He also added, “ We will be more efficient on the drug purchasing side and on the rebating side.”

Rite Aid’s buy comes nearly ten years after CVS Health Corp. bought Caremark Rx for $21 billion, the only other time a drug chain bought a benefits manager.