Catalyst Health Solutions Reports Second Quarter 2011 Financial Results

Catalyst Health Solutions, Inc. (NASDAQ: CHSI), today announced its financial results for the quarter ended June 30, 2011. The Company reported quarterly revenue of $1.2 billion and adjusted earnings per diluted share of $0.53. Net income in the second quarter was $12.3 million, or $0.25 per diluted share.

"We are pleased with the Company's operational and financial performance," stated David T. Blair, Chief Executive Officer of Catalyst. "In the second quarter, we completed the strategic acquisition of Walgreens Health Initiatives, Inc. (WHI), executed on our integration plans, retained key clients and sold new business.”

For the upcoming year, Catalyst has secured new PBM business consisting of self-funded employers and managed care plans which cumulatively represent more than $325 million in annualized revenue. The Company continues to pursue additional sales opportunities with January 1, 2012 effective dates.

The integration of WHI is expected to be completed within the next eighteen months. “Thanks to the collaborative efforts between Catalyst, Walgreens and WHI, we have made significant progress towards the integration of WHI and are confident that we will reach our previously stated financial targets,” added Richard A. Bates, President and Chief Operating Officer of Catalyst.

“With the integration of WHI on track, Catalyst is well positioned to capitalize on the opportunities emerging in the rapidly changing PBM landscape,” noted Blair. Management also confirms the Company is tracking towards its previously stated 2011 revenue and earnings guidance.

Second Quarter Results

Revenue for the second quarter increased by $0.3 billion, or 39%, to approximately $1.2 billion from $0.9 billion in the prior year’s comparable quarter. The increase in revenue is driven by higher prescription volume and price inflation on brand drugs, offset by the impact of the increase in generic utilization. Total unadjusted claims processed in the second quarter increased to 21.3 million excluding administrative-only prescriptions from 16.2 million for the same period in 2010. The increase in prescription volume was primarily due to the addition of new clients, the growth of existing clients and the acquisitions of FutureScripts and WHI. Generic utilization increased to 74% from 71% in the second quarter of 2010.