Chem Rx reaches asset purchase agreement with PharMerica

Sep 27 2010

Chem Rx Corporation (Pink Sheets: CHRXQ) ("Chem Rx"), the third largest long-term care pharmacy in the United States, today announced that it has reached a "stalking horse" asset purchase agreement to sell substantially all of the assets of the company to PharMerica Corporation (NYSE: PMC), an industry-leading pharmaceutical services company serving residents in long-term facilities and settings.  Partnering with Chem Rx will allow PharMerica to expand into New York and New Jersey, where it currently does not have a presence.  Chem Rx will continue to maintain normal business operations throughout this process and thereafter.

Per the terms of the agreement, Chem Rx's founder Jerry Silva and management team, including Steve Silva, Gary Jacobs, Evan Selzer, Paula Agoglia, Jody Silva-Falk, Shelly Evans, Michael Segal and Leora Tilocca will continue to be responsible for the day-to-day operations of Chem Rx. The company will also continue to operate under the Chem Rx name.  The sale, conducted pursuant to Section 363 of the U.S. Bankruptcy Code, will significantly eliminate the company's debt. 

"We are excited about joining forces with PharMerica, which shares our commitment to providing clients with the drugs and supplies they need accurately and on time," said Jerry Silva, Chem Rx Chief Executive Officer.  "This agreement will not only allow Chem Rx to continue serving our loyal customers in the same way we have for so many years, but also enable us to leverage the best technology available to ensure that we are at the forefront of long-term pharmacy care in the future.  We believe that PharMerica is the best partner to take the company forward and we look forward to working with PharMerica throughout this process."

Like Chem Rx, PharMerica is dedicated to providing quality customer service and innovative pharmacy solutions to institutional customers and patients in long-term care settings.  A leader in U.S. industrial pharmaceutical services, PharMerica operates 90 institutional pharmacies in 41 states that serve more than 300,000 licensed beds for patients of long-term care facilities.  PharMerica has approximately 6,000 employees nationwide.  

There will be no disruption of service or deliveries to Chem Rx's clients as a result of today's filing and subsequent auction proceedings.  Clients will continue to receive drugs, medical equipment and surgical supplies according to the same ordering processes and delivery schedules.

As standard procedure in the process, Chem Rx will file the stalking horse asset purchase agreement with the United States Bankruptcy Court for the District of Delaware along with a motion seeking the establishment of bidding procedures for an auction that allows other qualified bidders to submit higher or otherwise better offers.  The sale to PharMerica will include substantially all of Chem Rx's current assets, operations and employees.