State and local officials pledge effort to keep Accredo operations here
Aug 21, 2012 (Menafn - The Commercial Appeal - McClatchy-Tribune Information Services via COMTEX) --While the fate of Accredo Health Group in Memphis has been put in play by the 29.1 billion merger of Express Scripts and Medco, state and local officials are trying to keep the company and about 1,800 well-paying jobs in Tennessee.
Accredo's fate came into sharp focus last week after company officials mistakenly sent an email to employees indicating the Memphis facility could be reduced or eliminated.
Express Scripts spokesman David Whitrap said the email included confidential scenario planning information.
"This information was part of our initial evaluation process," Whitrap said in a Tuesday email. "It is not final and not representative of specific future plans."
Executives with St. Louis-based Express Scripts say they expect the Medco merger to produce 1 billion in savings by cutting duplicative services or business units not central to what the company does best.
So far, the company has publicly said it will sell the Liberty Medical diabetic testing business (maybe best known for its infomercials starring Wilford Brimley) and some units under the company's United BioSource Corp., according to a filing with the Securities and Exchange Commission in August. Express Scripts will also dissolve Medco's joint venture in China, wind down businesses in Germany and France and close its European headquarters in Amsterdam, the filing said.
But the future of Accredo is less certain. Express Scripts leaders have not publicly targeted the specialty pharmacy distributor for sale or closing. But Whitrap, the company spokesman, said Accredo "has been successful and is the home to many talented and accomplished professionals." He said the company is reviewing its business options and said there are "literally hundreds of scenarios that are being considered."
Still, the merger has created fear of losing a large employer and a Memphis company.
Accredo was basically born at Le Bonheur Children's Medical Center. In the 1980s, the hospital formed two companies to distribute certain drugs in the southeast,
Southern Health systems and Nova Factor. Accredo Health was formed in 1996 to acquire both of those businesses. Accredo went public in 1999 and was purchased by Medco in 2004.
Reid Dulberger, president of Memphis and Shelby County EDGE, said he expects a site visit from Express Scripts officials in the "not too distant future" but that the timing of that visit will be driven by the company.
"We expect to have the opportunity to help tout the benefits and successes of Accredo and why Express Scripts would be very wise to expand the operation here," Dulberger said.
The Greater Memphis Chamber is working on a plan to keep Accredo in Memphis but Mark Herbison, the group's senior vice president of economic development, said he would not divulge any details. But he is more than optimistic and is keeping a mantra of "we love Accredo and we want to keep them in Memphis."
"I still feel there's an opportunity to not only keep what we've got here but I think there's an opportunity to potentially bring more stuff to Memphis," Herbison said. "You have a company going through a process of analyzing what they're going to do and we stand a good chance to prove that we can be the best location and most-effective location to do business."
State officials are monitoring the merger shakeout, said Ted Townsend, greater Memphis regional director for the Tennessee Department of Economic and Community Development.
"The state has met with local stakeholder partners and we're at the table ready to assist in any way we can," Townsend said.
Memphis Mayor A C Wharton and Shelby County Mayor Mark Luttrell said last week they have been working to keep the company in Memphis.
No layoffs at Accredo had been reported to the Tennessee Department of Labor and Workforce Development as of Tuesday, according to the department's spokesman Jeff Hentschel.
Should Express Scripts divest Accredo, others would likely be looking to buy the whole thing or its pieces, said Adam J. Fein, president of pharmaceutical industry consulting firm, Pembroke Consulting.
"The specialty pharmacy industry is booming so there are many companies that may want the employees and physical assets that (are) part of the Accredo business," Fein said.
If Express Scripts decides not to sell the business to a competitor, Fein said, and decides instead to strategically shut down the facility here, "the individuals who work there in the specialty pharmacy industry should be able to find other jobs."
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