Elevance Health eyes acquisition of Paragon Healthcare

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Elevance Health is looking to expand, entering into an agreement late last week to acquire Paragon Healthcare, a company specializing in infusible and injectable therapies.

Paragon, which has been operating for more than 20 years, provides infusion services to patients through its omnichannel model of ambulatory infusion centers, home infusion pharmacies, and other specialty pharmacy services. The company, headquartered in Plano, Texas, provides care to patients with a broad range of chronic and acute conditions.

The transaction amount was not disclosed.

Pete Haytaian, executive vice president of Elevance Health and president of subsidiary Carelon, said the acquisition of Paragon will deepen the organization's capabilities around providing affordable and convenient access to specialty medications and other services for members living with chronic and complex illnesses.

"Together, Elevance Health and Paragon Healthcare will have the ability to provide members with greater choice on the most appropriate site of care options, such as ambulatory or in-home locations, which will remove barriers to care and better support members' whole health," he said.

WHAT'S THE IMPACT?

Paragon Healthcare serves more than 35,000 patients at over 40 ambulatory infusion centers across eight states, as well as in patients' homes. The company helps treat more than 300 health conditions and has 24/7 on-call support.

Following the acquisition, Elevance Health will look to expand Paragon Healthcare's geographical footprint and operations while bolstering its therapeutic coverage. Elevance will also remain committed to the company's leading customer service approach, the company said.

Once integrated, Paragon Healthcare patients who receive both medical and pharmacy benefits from Elevance Health's subsidiaries stand to benefit from the company's ability to leverage medical and pharmacy data to deliver proactive, whole health insights, said Elevance.

After the acquisition closes, Paragon Healthcare will operate as part of CarelonRx, the pharmacy-services segment within Carelon, Elevance Health's health services division.

The acquisition is subject to customary closing conditions and is expected to close in the first half of 2024. It is not expected to have a material impact on adjusted earnings per share in 2024.

THE LARGER TREND

Anthem changed its name to Elevance last year. 

Elevance took a step into the specialty pharmacy space early last year when it finalized its acquisition of BioPlus, which provides a range of specialty pharmacy services for patients living with complex and chronic conditions, such as cancer, multiple sclerosis, hepatitis C, autoimmune diseases and conditions in rheumatology.

Elevance anticipated the acquisition would help it meet the specialty-drug needs of clients and customers with a more whole health-focused approach.

Financial results for the fourth quarter of 2023 have not yet been revealed, but in Q3 Elevance raked in $1.3 billion in profit, and while this was a decrease from the $1.6 billion posted in Q3 2022, overall revenue climbed year over year, hitting $42.5 billion compared to $39.9 billion last year.

The increase was primarily driven by higher premium revenue in the health benefits business, and growth in pharmacy product revenue in CarelonRx due to growth in external pharmacy members served, plus the acquisition of BioPlus in the first quarter.
 

Twitter: @JELagasse
Email the writer: Jeff.Lagasse@himssmedia.com