S&P: Express Scripts rating unaffected by acquisition

Standard & Poor's said Monday that Express Scripts Inc.'s (BBB/positive/--) announcement that it was planning to acquire specialty pharmaceutical distributor CuraScript PBM Services Inc. for $335 million does not affect its credit rating or outlook.

The proposed acquisition would expand St. Louis, Mo.-based pharmacy benefit manager Express Scripts' ability to compete in the fast-growing specialty pharmaceutical distribution business. The specialty pharmaceutical industry is relatively higher margin and is expected to grow 20%-30% annually over the intermediate term.

S&P said it had incorporated a moderate level of acquisitions into its rating on Express Scripts, which were upgraded Oct. 30. Given the company's strong position in the PBM industry, solid prospects for earnings and cash flow generation growth, and a moderate financial profile that is characterized by debt to EBITDA of below 2x, Express Scripts is well positioned to continue to successfully compete in the highly competitive and evolving PBM industry.

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