Diversified Pharmaceutical Services entered the market in 1976 as the pharmacy benefit manager for UnitedHealth Group, a leading managed care organization. By 1993, DPS managed pharmaceutical benefits for about 14 million people and approximately $2 billion in drug expenditures, making it the third-largest PBM at the time.[1]
United HealthCare sold DPS to SmithKline Beecham for $2.3 billion in cash in May 1994.[1] In 1999, SmithKline Beecham sold DPS to Express Scripts for $700 million in cash.[2]
History
Diversified Pharmaceutical Services (DPS) was founded in 1976 as a wholly owned subsidiary of United Healthcare Corporation.[3][4] The company developed from the pharmacy operations within United HealthCare and grew during the expansion of the pharmacy benefit management (PBM) industry in the 1980s and early 1990s.[3]
By 1993, DPS administered prescription drug benefits for approximately 14 million individuals and managed about $2 billion in annual drug expenditures, ranking it among the largest PBMs in the United States at the time.[1]
The company was sold to SmithKline Beecham for $2.3 billion in May 1994.[5] In 1999, it was acquired by Express Scripts in 1999 for $700 million in cash to create what was then the third largest pharmacy benefit manager in the United States.[6]
References
- Pharmacy Benefit Managers: Early Results on Ventures With Drug Manufacturers U.S. General Accounting Office (GAO), 1995, retrieved 2026-02-11^
- EXPRESS SCRIPTS SET TO GROW WITH BUY OF SMITHKLINE PBM Business Insurance, 1999-02-14, retrieved 2026-02-11^
- Pharmacy Benefit Managers: Early Results on Ventures With Drug Manufacturers U.S. General Accounting Office (GAO), 1995, retrieved 2026-02-11^
- Robert Navarro. Managed Care Pharmacy Practice Jones & Bartlett Learning, 1999^
- Milt Freudenheim. A Shift of Power in Pharmaceuticals The New York Times, 1994-05-09, retrieved 2020-03-04^
- Express Scripts to Acquire Diversified Pharmaceutical Services PRNewswire, February 9, 1999, retrieved October 31, 2015^