Celesio and Medco, two of the world’s leading pharmacy-driven healthcare companies, announced a joint venture with a long-term goal of improving the quality of patients’ healthcare through integrated solutions and relieving the financial burden on healthcare payors across Europe.

Headquartered in Amsterdam, the 50/50 joint venture, Medco Celesio B.V., combines Medco’s and Celesio’s strengths in pharmacy-driven clinical care. Medco Celesio BV is designed to help patients with chronic or complex conditions, such as diabetes, asthma, high-cholesterol and heart disease. It will concentrate on innovative, integrated clinical services designed to improve patient adherence – meaning following doctors orders – integrate care across multiple providers, and enhance safety and efficiency across the healthcare system.

“Our portfolio of proven clinical solutions can be customized to address the growing demand for affordable, high-quality care that is relevant across geographic, regulatory and cultural boundaries. Although this will not eliminate every financial issue facing the European healthcare systems, these efficiencies represent a significant part of the overall solution,” underscored David B. Snow, Jr CEO of Medco.

Dr Fritz Oesterle, CEO Celesio: “Chronic diseases are increasing with an alarming speed all over the world and they are associated with more than three quarters of the overall healthcare burden. Healthcare, especially for chronically ill patients, is therefore going to be a big social, political and economic challenge. If we do not tackle these challenges in an appropriate way it could affect both the quality of life for chronically ill patients and economic growth in Europe. So it is obvious that there is a strong need for new integrated solutions across Europe ensuring high quality of care, while reducing costs for the healthcare systems.”

The joint venture will go into operation initially in Germany in 2010, including the collaboration of the parent companies’ respective mail order pharmacies, DocMorris and Europa Apotheek Venlo. It will then extend rapidly in phases to the major European markets, including the UK, France, Spain and Italy. Over time, it is planned to expand its geographic footprint into as many as 27 EU member states plus Switzerland and Norway, following the respective market needs and enabling regulations.

While there are significant differences in the regulatory environments and healthcare system structures across European countries, the challenges related to resolving the cost and quality issues are common.

Medco Celesio BV’s business model will initially consist of three comprehensive service offerings, customized for each market and focused on improving care for patients with the greatest need: Suite of advanced clinical solutions. Medco Celesio B.V. will offer analytical insights enabling payors (including national health agencies, sick funds, and other authorized entities) to identify and correct clinical issues and monitor the effectiveness of their healthcare programs. By deploying new technology tools and support systems, Medco Celesio B.V. will advance the efficiency of pharmacy in healthcare by helping payors and providers – including physicians, nurses, pharmacists and healthcare counselors – with an integrated approach to improve their services for patients. At the same time it will provide sustainable cost management. ; Intensive, personalized care services addressing expensive new “specialty” and “biotech” medicines. Medco Celesio B.V. will provide care for patients who are taking medicines that require special handling and are considered "biologics" -- these medicines are very expensive, difficult to administer and often require special handling. This service supports patients by helping to ensure that these medicines are taken appropriately per the healthcare provider's direction, and therefore, provide the greatest benefit possible; Modern, efficient delivery infrastructure. Medco Celesio B.V. will coordinate care delivery systems effectively and efficiently by offering convenient mail order pharmacies as an appropriate complement to retail pharmacy services, in-home nursing support to help ease the burden on hospitals, and telephone patient counseling so that pharmacy assistance is immediately accessible to patients any time of any day.

Faced with an aging population and increasing costs associated with innovative treatments and technologies, healthcare spending in many European countries is growing at a more rapid rate than the respective national GDP. An estimated 77 per cent of all healthcare burden across Europe is caused by one specific patient group: patients with chronic and complex conditions.

“In order to enhance the quality of care and at the same time lower total healthcare costs it is crucial to improve the situation of chronically ill patients, who need pharmaceutical therapy, in large part, to avoid longer-term medical care. If we do this efficiently through integrated solutions we can improve the quality of life for the patients, while simultaneously avoiding unnecessary costs that amount to billions of Euros”, said Dr Fritz Oesterle, CEO of Celesio. “These avoidable costs result from non-adherence, among other factors.”

Statistics show that within the first year of treatment more than half of all patients abandon their prescribed therapy. In other cases medicines that should be prescribed in accord with the latest treatment guidelines are not ordered, e.g. in Germany every fifth medical prescription is not filled at a pharmacy. In Europe the costs associated with patients not following their physicians’ recommendations are estimated to amount to 200 to 300 billion Euros per year.

This is often because patients are hospitalized when their condition, which could have been stabilized by being adherent, further deteriorates.

Medco has been offering a broad portfolio of advanced, clinically driven services in the United States very successfully for many years. In diabetes care, for example, Medco studies in the US have shown that implementing advanced pharmacy techniques reduces overall per-patient medical spending by nearly 50 per cent, as adherence improves, largely by reducing the need for hospitalizations.

The joint venture will cooperate closely with health policy makers, funding bodies, pharmacies, healthcare providers and their umbrella organizations, producers of pharmaceuticals, patients’ associations and leading research institutes.

“We will strive to earn a position as the trusted partners of healthcare payors, as they achieve a financially sustainable model for providing needed access to quality care. We will serve to advocate for patients, who through our extended services will become empowered, educated and active participants in their care”, said Medco’s CEO Snow. “We will become a resource for medical practitioners, who can focus on treating their patients using the latest evidence-based protocols. We will help retail pharmacies by delivering advanced safety systems and consultative tools that will help them achieve higher patient compliance. And we will support pharmaceutical manufacturers to demonstrate increasing value by reaching the most appropriate patient groups with the most effective medicines.”

The joint venture is an important strategic step for both Celesio and Medco to speed entry into new markets and market segments with important new clinical services. The legacy businesses of both parties, however, are not included in the joint venture.

“The healthcare markets provide innovative companies with immense growth-potential. Medco’s clinical solutions combined with Celesio’s pan-European reach and market expertise provide much needed solutions for some of the most pressing problems in the European healthcare systems”, said Celesio’s CEO Oesterle. “The joint venture’s businesses integrate the competencies of both companies into innovative, efficient solutions for the benefit of patients and payors. At the same time it will also give new opportunities to the business of our existing customers as potential partners cooperating with the joint venture.”

Medco Health Solutions, Inc. is pioneering the world’s most advanced pharmacy® and its clinical research and innovations are part of Medco making medicine smarter for approximately 65 million members.

Celesio is one of the leading international service providers within the pharmaceutical and healthcare markets. The company is active in 26 countries worldwide and employs approximately 47,000 people in its three divisions Patient and Consumer Solutions, Pharmacy Solutions and Manufacturer Solutions.