Express Scripts Inc. said Wednesday its profit rose 8 percent in the fourth quarter, as the pharmacy benefits manager gained new business after buying a division from health insurer WellPoint.
The news sent Express Scripts shares surging in aftermarket trading. The stock jumped $9.45, or 10.8 percent, to $97.20 from a closing price of $87.75.
The company said its profit rose to $223.3 million from $206.8 million. Its per-share profit fell to 80 cents from 83 cents because Express Scripts had more shares on the market. Revenue climbed 49 percent to $8.2 billion from $5.51 billion.
Excluding costs related to the purchase of NextRx and other one-time items, the company said it earned 97 cents per share. According to Thomson Reuters, analysts expected a profit of 90 cents per share and revenue of $7.4 billion.
In April 2009, the company bought WellPoint's pharmacy benefit management business, called NextRx, for about $4.68 billion. That made Express Scripts the second largest U.S. pharmacy benefits manager by revenue, behind Medco Health Solutions and ahead of CVS Caremark.
The pharmacy benefits managers handle prescription drug benefits for health plan sponsors and members. They make money by reducing expenses, which is frequently done by encouraging greater use of low-cost generic drugs.
Express Scripts said it filled 154.6 million adjusted claims during the fourth quarter, up 23 percent from a year ago. That figure includes standard 30-day prescriptions along with more profitable 90-day prescriptions, which are often filled by mail.
The company said 69.1 percent of prescriptions were filled using generic drugs, compared to 67.3 percent in the fourth quarter of 2008.
For the full year, the company said its profit rose 7 percent to $827.6 million, or $3.11 per share, from $776.1 million, or $3.08 per share. Revenue rose 13 percent to $24.75 billion from $21.98 billion.
For 2010, Express Scripts forecast a profit of $4.80 to $5 per share. Analysts are expecting $4.69 per share, on average.
The company said it will fill between 740 million to 760 million adjusted claims, and said NextRx will contribute more than $1 billion in additional profit before interest, taxes, depreciation and amortization once integrated.