Abarca Health and LucyRx, two independent pharmacy benefit management companies, are set to merge in a move aimed at providing an alternative to the nation’s largest PBMs, as consumers demand more affordable prescription drug prices. The merger of Abarca and LucyRx will form a pharmacy benefit management business that will cater to over 9 million plan members across the United States. This deal aims to establish “the only modern, independent pharmacy benefit manager with the scale, technology, and track record to credibly serve commercial and government clients of any size,” the companies stated on Wednesday, June 17, 2026.
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The merger of Abarca Health and LucyRx, both independent pharmacy benefit managers, signifies a shift in the industry as it presents an alternative to the country’s three largest PBMs. This may not be the last instance of smaller industry players combining forces.
With this merger, Abarca-LucyRx will position itself among the top 10 PBMs by the number of prescriptions managed, although it will still be much smaller than the three dominant PBMs that control 80% of the U.S. market: CVS Health’s Caremark, Express Scripts owned by Cigna, and OptumRx owned by UnitedHealth Group.
Pharmacy benefit managers (PBMs) serve as intermediaries between insurers, pharmacies, and drug manufacturers to negotiate drug prices and manage prescription benefits.
Recently, the PBM market has faced increased scrutiny from virtually every state and the U.S. government, which are examining PBM business practices, transforming regulations, and advocating for more transparency. The top three PBMs are currently under a Federal Trade Commission inquiry for alleged anti-competitive behavior that reportedly led to inflated drug prices, though the companies deny these claims.
Beyond the top three, other major PBMs such as Humana Pharmacy Solutions, MedImpact Healthcare Systems, and Prime Therapeutics collectively account for less than 16% of the U.S. market, according to Drug Channels.
Smaller PBMs struggle to absorb the rising administrative costs associated with increasing regulations, which industry analysts and companies say are driving up expenses while they aim to control prescription drug costs for clients. Pharmacy costs are already the fastest-growing component of employer and worker health expenses.
“The growing administrative complexity of state and federal regulation will disproportionately burden smaller PBMs that lack the scale, capital, and integrated infrastructure of the largest organizations,” Adam J. Fein, President of Drug Channels Institute, wrote in an analysis last month regarding the PBM market. “Over the next five years, we expect many smaller PBMs to disappear through acquisition, consolidation, or business failure.”
Abarca and LucyRx executives anticipate that other PBM entities will also seek partnerships.
“The same forces that shaped this combination will continue to reshape the industry,” said Abarca’s CEO, Jason Borschow.
“The market is at a breaking point,” Borschow added. “Clients are demanding real accountability. And the regulatory environment increasingly rewards scale and transparency.”
Abarca, based in San Juan, Puerto Rico, and LucyRx, based in Bethesda, Maryland, will maintain their brand identities and operate as wholly owned subsidiaries under Healthcare Revolution Partners once the deal is finalized in the third quarter of this year, pending regulatory approval.
“This is about creating a model for what the market can and should become, not just what Abarca and LucyRx can accomplish together,” said Borschow, who will co-chair Healthcare Revolution Partners.
LucyRx’s CEO, David Blair, also co-chair of Healthcare Revolution Partners, noted that the “rapidly evolving prescription care landscape is fundamentally reshaping how pharmacy benefits are managed.”
“New transparency requirements and administrative obligations, along with the continued introduction of new high-cost medications and direct-to-consumer drug manufacturer programs, are raising the bar for every player in this market,” Blair stated. “Organizations that can build the operational scale to meet those demands while still delivering for clients and patients will be best positioned to lead. That’s exactly what the Abarca and LucyRx combination is designed to do, and is where the market is headed.”
