Merck & Co. will spin off Medco Health Solutions directly to shareholders, abandoning plans announced 15 months ago for an initial public offering. Officials said they continue to believe both businesses -- drug manufacturing and pharmacy benefits management -- will be stronger as separate companies, but the market hasn't recovered from the unfavorable conditions that led Merck, Whitehouse Station, N.J., to postpone the IPO last July. Medco posted $33 billion in sales in 2002, making it the nation's largest pharmacy benefits manager, according to Merck. The drugmaker acquired Medco in 1993, setting off a flurry of similar acquisitions by rival companies. Other drug companies also have since divested their benefits managers. The spinoff is expected to be completed by midyear, subject to regulatory approval and market conditions. -- by Cinda Becker
Merck to spin off Medco to shareholders, no IPO
Send us a letter
Have an opinion about this story? Click here to submit a Letter to the Editor, and we may publish it in print.