Express Scripts Increases Guidance; Anthem Contract Unlikely To Be Extended

(RTTNews) - Express Scripts Holding Company (ESRX) increased its guidance for 2017 adjusted earnings per share to a range of $6.90 to $7.04, from a range of $6.82 to $7.02, which represents growth of 9% over 2016 adjusted earnings per share results at the mid-point of the range.

The company expects total adjusted claims for the second quarter of 2017 to be in the range of 343 million to 353 million. Adjusted earnings per share for the second quarter of 2017 is estimated to be in the range of $1.70 to $1.74, which represents growth of 8% to 11% over the second quarter of 2016.

Express Scripts reported first-quarter net income of $546.3 million or $0.90 per share. The 2017 first quarter adjusted earnings per share was $1.33, up 9%. Adjusted claims were 351.7 million, down 1% from prior year.

Express Scripts also announced that, based on recent statements in conversations with Anthem management and other actions taken by Anthem, the company believes it is unlikely its contract with Anthem will be extended. The company's current long-term PBM contract with Anthem expires on December 31, 2019, and Anthem is currently engaged in a Request for Proposal process for a PBM service provider following the end of its contract with Express Scripts. The Anthem contract generated approximately $2.2 billion and $1.9 billion of adjusted EBITDA, or approximately 31% and 26% of total adjusted EBITDA, in 2016 and 2015, respectively.