Express Scripts 2012 Annual Report Download - page 5

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Express Scripts 2012 Annual Report 3
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legacy Medco organization was known for Therapeutic Resource CentersSM (TRCs), or, more broadly, the strategic use of
clinical specialization. Now, as a result of the Company’s expanded member population and enhanced systems, Express
Scripts offers a third capability: actionable data. The Company combines these three complementary capabilities —
behavioral sciences, clinical specialization and actionable data — to create an innovative, proprietary approach to better
decisions and healthier outcomes called Health Decision ScienceSM. Embedded throughout the Company’s offerings, Health
Decision Science is a blend of our most advanced capabilities to optimize current products and develop the next generation
of solutions for patients and plan sponsors. Using Health Decision Science, Express Scripts has built practical solutions for
three decision areas: drug choices, pharmacy choices and health choices.
Plan sponsors who are more aggressive in taking advantage of our effective tools to manage drug spend have seen
reductions in their prescription drug trend while preserving healthcare outcomes. Greater use of generic drugs and lower-
cost brand drugs has resulted in significant reductions in spending for commercially insured consumers and their
employers.
We have organized our operations into two business segments based on products and services offered: PBM and
Other Business Operations.
Our PBM segment primarily consists of the following services:
Q domestic and Canadian retail network pharmacy management
Q home delivery pharmacy services
Q benefit design consultation
Q drug utilization review
Q drug formulary management, compliance and therapy management programs
Q a flexible array of Medicare Part D and Medicaid products to support clients’ benefits
Q specialty pharmacy, including the distribution of fertility pharmaceuticals requiring special handling or packaging
Q bio-pharma services including reimbursement and customized logistics solutions
Q administration of a group purchasing organization
Q consumer health and drug information
Q improved health outcomes through personalized medicine and application of pharmacogenomics
The Other Business Operations segment primarily consists of the following services:
Q distribution of pharmaceuticals and medical supplies to providers and clinics
Q scientific evidence to guide the safe, effective and affordable use of medicines
Our revenues are generated primarily from the delivery of prescription drugs through our contracted network of
retail pharmacies, home delivery and specialty pharmacy services and Other Business Operations services. Revenues from
the delivery of prescription drugs to our members represented 99.0% of revenues in 2012, 99.4% in 2011, and 99.4% in
2010. Revenues from services, such as the fees associated with the administration of retail pharmacy networks contracted
by certain clients, medication counseling services, and certain specialty distribution services, comprised the remainder of
our revenues.
Prescription drugs are dispensed to members of the health plans we serve primarily through networks of retail
pharmacies that are under non-exclusive contracts with us and through home delivery fulfillment pharmacies, specialty
drug pharmacies and fertility pharmacies we operated as of December 31, 2012. More than 67,000 retail pharmacies, which
represent over 95% of all United States retail pharmacies, participated in one or more of our networks at December 31,
2012. The top ten retail pharmacy chains represent approximately 60% of the total number of stores in our largest network.
Express Scripts, Inc. was incorporated in Missouri in September 1986, and was reincorporated in Delaware in
March 1992. Aristotle Holding, Inc. was incorporated in Delaware on July 15, 2011. Aristotle Holding, Inc. was renamed
Express Scripts Holding Company concurrently with the consummation of the Merger.
Our principal executive offices are located at One Express Way, Saint Louis, Missouri, 63121. Our telephone
number is 314.996.0900 and our web site is www.express-scripts.com. Information included on our web site is not part of
this annual report.