The world’s biggest healthcare companies in 2018

20 June 2018 (Last Updated January 23rd, 2020 13:31)

The healthcare companies that achieved high revenue in 2017 focused on providing innovative healthcare services and products. Mergers and acquisitions of smaller healthcare companies were also one of the key strategies adopted. Medicaldevices-technology.com lists the world’s biggest healthcare companies based on 2017 revenues.

The world’s biggest healthcare companies in 2018
McKesson Corporation, the world’s biggest healthcare company by revenue, provides a range of pharmaceutical services to the hospital and non-hospital market. Image courtesy of Adriaan Bloem.

McKesson Corporation – $208.3bn

McKesson Corporation posted a year-on-year revenue growth of 4.9% in 2017, which is thought to be a result of price increases, increased drug utilisation, business acquisitions and continued relationships with existing customers within its North America pharmaceutical distribution businesses.

Based in the US, McKesson provides pharmaceuticals, medical products and other services to hospitals and healthcare systems. It also offers pharmaceutical services to biotechnology and medical companies, as well as delivers healthcare equipment and services to the non-hospital market.

The company operates through its distribution solutions and technology solutions divisions.

McKesson formed a joint venture (JV) with Change Healthcare Holdings (CHH) in March 2017 to provide a range of innovative solutions to payers, providers and consumers. Named Change Healthcare, the new entity combines CHH’s entire business with the majority of McKesson’s technology solutions business.

UnitedHealth Group – $201bn

UnitedHealth Group registered a year-on-year revenue growth of 9% in 2017. The company operates through UnitedHealthcare and Optum units, which achieved revenue growth of 13% and 11% respectively.

Based in Minnesota, US, UnitedHealth Group is a provider of medical benefits to people in the US and 130 other countries. It processes more than one trillion transactions a year and employs 285,000 people worldwide.

Its UnitedHealthcare Global segment merged with Chile-based Empresas Banmédica in January 2018, enabling UnitedHealth Group to expand its services to Chile, Peru and Colombia. The company was also placed at the top of Fortune’s 2018 World’s Most Admired Companies list for the insurance and managed care sector.

CVS Health – $184.7bn

Pharmacy innovation company CVS Health’s revenue in 2017 witnessed a year-over-year growth of 4.1%, which was driven primarily by growth in the company’s pharmacy network, prescription volumes and pharmacy benefit management (PBM) product introductions.

Headquartered in Rhode Island, US, the company owns more than 9,800 retail stores and up to 1,100 MinuteClinic medical facilities. It employs approximately 246,000 people.

CVS Health operates through its pharmacy services, retail/ long-term care (LTC) and corporate businesses.

CVS Health entered a definitive merger agreement in December 2017 to acquire healthcare benefits company Aetna for $69bn. Expected to be completed in 2018, the transaction will help CVS Health to strengthen its market position.

AmerisourceBergen Corporation – $153.1bn

The growth of AmerisourceBergen Corporation’s pharmaceutical distribution services segment helped increase the company’s revenue by 4.3% year-over-year.

The firm’s customers, including Walgreens Boots Alliance and Express Scripts, contributed to 45% of the revenue.

AmerisourceBergen Corporation is a sourcing and distribution services company engaged in providing pharmaceutical products to healthcare providers, veterinary practices and livestock producers.

Headquartered in Chesterbrook, Pennsylvania, AmerisourceBergen employs 20,000 people in 50 countries worldwide. Its recent acquisition of US-based H D Smith is expected to drive AmerisourceBergen’s revenue further by up to 11% in 2018.

Cardinal Health – $129.9bn

Cardinal Health reported a 7% increase in revenue in 2017 in comparison with 2016. This was complemented by its two business segments, pharmaceutical and medical, which increased their revenues by 7% and 9% respectively.

Based in Dublin, Ohio, US, Cardinal Health is involved in providing medical products, pharmaceuticals and solutions to hospitals, pharmacies, healthcare systems, clinical laboratories, ambulatory surgery centres and physician offices.

With a workforce of 50,000, the company serves its customer’s needs in 60 countries worldwide.

Cardinal Health acquired Patient Care, Deep Vein Thrombosis and Nutritional Insufficiency businesses from Medtronic for $6.1bn in July 2017. The acquisition increased Cardinal Health’s product offerings to approximately 21,000 stock-keeping units (SKU) in 1,200 categories.

Express Scripts Holding – $100.06bn

Express Scripts Holding is one of the biggest pharmacy benefit managers in the US. Its revenue in 2017 was derived from the delivery of prescription drugs, which accounted for 98.2% of the total revenue.

The company’s pharmacy benefit management (PBM) segment contributed 95.2% to the 2017 revenues.

Headquartered in Missouri, US, Express Scripts offers a range of services, including home delivery pharmacy care, speciality pharmacy care, network-pharmacy claims processing, and benefit-design consultation. It employs roughly 28,000 people worldwide and has a client base of 3,000. The company was ranked as one of Fortune’s 2017 World’s Most Admired Companies.

Express Scripts acquired myMatrixx Holdings for $250m in May 2017, and eviCore for approximately $3.6bn in December 2017. The acquisitions aimed to enhance the company’s pharmacy and healthcare services offerings.

Anthem – $89.06bn

Anthem’s revenue increased by 5.8% year-on-year in 2017, driven by revenue growth across all of its segments, including commercial and speciality business (5.3%) and government business (6.2%).

Based in Indiana, US, Anthem is a health benefits company involved in providing medical and speciality products. The commercial and speciality business segment includes local groups, national accounts, and individual speciality businesses, while the government business unit comprises Medicaid and Medicare businesses, a federal employee programme, and the national government services.

The company’s medical enrolment grew by 0.8% in 2017 to reach 40.2 million, while enrolment in the commercial and speciality business increased by 278,000 members in 2017.

The government business unit also enrolled 47,000 in the year. The acquisition of 1st Choice in February 2018 increased the consumer base of Anthem’s affiliated Medicare and Medicaid plans to 780,000 in Florida.

Kaiser Permanente – $72.7bn

Kaiser Permanente posted revenues of $72.7bn in 2017, a 12.5% increase compared to 2016. It operates through entities, including Kaiser Foundation Hospitals and its subsidiaries, Kaiser Foundation Health Plan and The Permanente Medical Groups.

With headquarters in Oakland, California, Kaiser Permanente provides healthcare and coverage to 11.8 million US customers. It has 39 hospitals and 680 medical facilities with a workforce of 213,087.

The company was one of the first to receive a ‘Centers for Medicare & Medicaid Services’ Health Equity Award in February 2018.

Kaiser Permanente acquired Washington-based Group Health Cooperative in February 2017, adding roughly 651,000 Group Health members and 6,000 employees to its business.

Aetna – $60.5bn

Aetna witnessed a decline in revenue by 4% in 2017, compared with $63.1bn in 2016, due to lower premiums in the healthcare segment, temporary suspension of the health insurer fee, and the sale of its group insurance segment to Hartford Life and Accident Insurance Company in November for $1.45bn.

The group insurance segment comprised domestic group life insurance, group disability insurance and absence management businesses.

Aetna is a healthcare benefits company based in the US. It provides health insurance products and related services to approximately 37.9 million people, and operates through its healthcare and large case pensions segments.

The company’s medical membership of the totalled 23,487 as of December 2017, while the total dental and pharmacy benefit management services memberships stood at 13,427 and 13,765 respectively.

The company terminated a merger agreement signed with Humana in July 2015 against a civil complaint alleging that the acquisition would violate Section 7 of the Clayton Antitrust Act. As per the termination agreement, signed in February 2017, Aetna paid a termination fee of $1bn to Humana.

Humana – $53.7bn

Humana’s revenues in 2017 decreased by 1% year-on-year due to lower revenue from its individual commercial segment. The revenues from its total premiums and services also declined 1% year-on-year to $53.36bn.

Based in Louisville, Kentucky, the company serves approximately 260,000 people through 195 clinics across 27 markets. Humana operates through its retail, group and speciality, healthcare services, and individual commercial segments.

The company signed a definitive agreement to sell its KMG America Corporation subsidiary to Continental General Insurance Company in November 2017. It also signed a definitive agreement to buy a 40% minority stake in Kindred at Home Division of Kindred Healthcare for $800m in December 2017. Humana opened 15 new clinics in seven markets in 2017.