(Reuters) ? Pharmacy benefits manager Express Scripts Inc and its client WellPoint Inc said on Tuesday they are involved in a contract dispute and that they are trying to settle it through negotiation.
Express Scripts said WellPoint, the No. 2 U.S. health insurer by market value, had raised the issues leading to the dispute.
Shares of Express scripts fell 3.5 percent after hours, while WellPoint stock rose 2 percent.
Officials from both companies declined to provide details and said there is no assurance the matters will be settled without litigation. But in any event, Express Scripts said it does not expect the resolution of the matters to have a material adverse effect on its business.
The companies said the dispute concerns terms of a PBM agreement they reached on December 1, 2009, the same day that Express Scripts bought Wellpoint's drug PBM business for $4.68 billion.
At the time WellPoint's drug benefit business was the country's fourth largest -- behind Medco Health Solutions, CVS Caremark and Express Scripts -- covering 25 million Americans.
The acquisition gave Express Scripts greater leverage to negotiate prices with drugmakers on behalf of its clients, typically big companies and their employees.
The deal included a 10-year contract under which Express Scripts was assigned to provide drug benefit services for WellPoint.
"The dispute relates to the interpretation of certain financial contractual terms in the PBM agreement and certain operational matters associated with Express Scripts' performance thereunder," WellPoint spokeswoman Kristin Binns said in an emailed statement to Reuters.
Express Scripts is planning to buy rival Medco for more than $29 billion, creating a U.S. powerhouse in managing prescription drug benefits. Shareholders of both companies are expected to vote later this month on whether to approve the deal.
Pharmacy benefit managers administer drug benefits for employers and health plans and also run extensive mail-order pharmacies.
(Reporting by Michele Gershberg and Ransdell Pierson in New York; Editing by Steve Orlofsky, Tim Dobbyn and Phil Berlowitz)
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