McKesson profit slides slightly during third quarter, seals $1 billion deal for CoverMyMeds

McKesson revealed Wednesday that its net income slid to $633 million during its 2017 fiscal third quarter from the $634 million profit it posted during the same period the previous year. Revenues, though, grew five percent, from $47.9 billion to $50.1 billion.

At the same time, McKesson unveiled plans to acquire CoverMyMeds for about $1.1 billion. CoverMyMeds specializes in technology that automates prior authorizations for medication for pharmacies, pharmacy benefit managers, prescribers and payers. McKesson will pay an additional $270 million if CoverMyMeds puts up strong financial performance over the next two years.

[Also: McKesson hit with record $150 million civil penalty for alleged Controlled Substance Act violations]

The deal is expected to close sometime after April 1, when McKesson's 2018 fiscal year begins. CoverMyMeds will remain in Columbus, Ohio and be operated as an independent business, with Matt Scantland maintaing his role as CEO.

CoverMyMeds has used the RelayHealth Pharmacy connectivity network since 2010. RelayHealth is also operated my McKesson, and will remain so after the deal is completed. The U.S. Department of Justice ended its antitrust review of the McKesson-RelayHealth transaction on Dec. 20.

[Also: McKesson Technology Solutions to rebrand as Change Healthcare after merger closes]

McKesson is moving its Provider Solutions division into a new venture with software and networking outfit Change Healthcare, with McKesson owning 70 percent of the proposed venture and receiving $1.25 billion from the cash proceeds. Change Healthcare stands to receive $1.75 billion from the venture.

That deal is expected to close during the first half of this year and the venture, which McKesson and Change Healthcare will jointly govern, will have combined total annual revenues of $3.4 billion.

Twitter: @JELagasse