340B pharmacy and health-system services provider CPS Solutions, based in Dublin, Ohio, announced late last week that it has acquired specialty pharmacy services company Trellis Rx, headquartered in Atlanta, Ga.
Both companies have personnel with several decades of 340B experience. Their union is the latest in a recent string of 340B business sector mergers.
CPS, whose services include consulting on 340B program compliance and savings optimization and pharmacy management, did not provide financial terms of the deal, which closed June 1. Trellis helps 340B health systems start and expand on-site specialty pharmacies.
“This acquisition helps us to deliver a broader range of offerings and flexibility across our inpatient and outpatient businesses,” CPS Chairman & CEO Frank Segrave told 340B Report. “CPS will continue to invest in all of our service offerings on both the inpatient and outpatient segments of our business so that we can help our clients become successful operationally and financially.” Segrave has a long history in the pharmacy supply chain including starting a pharmaceutical company geared towards pediatric patients with serious conditions and holding senior pharmacy positions at Cardinal Health and Wal-Mart.
“Trellis and CPS complement each other and together, we can create a more diverse offering across inpatient, outpatient and specialty pharmacy settings for health and hospital systems serving communities of all sizes,” said Trellis co-founder and CEO Andy Maurer. Mauer, who earlier in his career co-founded 340B third party administrator Macro Helix, told 340B Report late last week he would join the CPS management team. Pharmaceutical distributor McKesson acquired Macro Helix 10 years ago. Before starting Macro Helix, Maurer was a consultant to 340B covered entities at Ernst & Young and Navigant.
CPS said the two companies would continue to operate under their respective brand names in the near term. CPS, its hospital specialty, retail, and infusion pharmacy division Azina, and Trellis “are highly respected and recognizable brands in the industry,” Segrave told 340B Report. “We will take our time to evaluate our collective brand presence in the market. No decision has been made regarding the names going forward.” CPS employs over 2,000 pharmacy and healthcare professionals and services over 800 hospitals and healthcare facilities nationwide. While the company’s roots are in the hospital sector, it has expanded its offerings and client base to other covered entities such as community health centers.
The merger augments CPS’s growing specialty pharmacy services unit, with the consolidated companies able to provide access to a wider range of specialty medications and to support a larger and more diverse client base, ranging from small to large independent hospitals and health systems, the company said in a June 3 statement.
“The growth of specialty pharmacy in the hospital segment is being driven by the desire to improve quality of patient care and bring treatment closer to the providers, which will improve patient outcomes,” Segrave told 340B Report. Drug innovation from the manufacturers is a major driver of the specialty pharmacy sector overall, he added.
Segrave said further acquisitions remain on the company’s radar screen for specialty pharmacy, as well as with its other business units. “We are always looking for ways to expand and enhance CPS’ services to hospitals and health systems,’ he said. “As we work with our clients to determine needs, we are open to developing them or acquiring them.”
CPS’s key services include helping hospitals, health centers and other covered entities secure 340B drug discounts, helping pharmacy and clinical personnel automate their processes and provide better visibility on medications, and telepharmacy. The company manages pharmacies throughout the country and provides a variety of auditing and compliance services.
CPS, formerly Comprehensive Pharmacy Services, changed its name last September to reflect its expansion beyond its pharmacy core to include other health system services. CPS, which is now close to 50 years old, began working in the 340B space in 1992 when the 340B law was enacted by Congress.
Both CPS and Trellis are 340B Report sponsors.
There has been a wave of consolidation in the 340B services sector. tangoRX announced its acquisition of RPh Innovations in May. Signify Health announced it was acquiring Caravan Health in February. Omnicell acquired specialty pharmacy company ReCept Holdings in December 2021 and Pharmaceutical Strategies Group’s 340B Link business in August 2020. Cloudmed acquired par8o in December 2021. In September 2021, Walgreens Boots Alliance acquired a majority stake in Shields Health Solutions for roughly $970 million, according to published reports, bringing Walgreens’ total share to 71%.