McKesson has bolstered its cancer care platform with the purchase of US Oncology, a Woodlands, Texas-based developer of clinical tools, guidelines and care pathways for doctors and others in the field of cancer-related healthcare.

The acquisition, announced Nov. 1 and expected to be completed by the end of the year, is valued at $2.16 billion.  McKesson – the nation’s largest drug distributor, with a reported $16 billion in revenue last year – purchased all of US Oncology’s shares in cash and take over the company’s $1.08 billion in debt from the private equity firm Welsh, Carson, Anderson & Stowe. McKesson officials said the debt will be refinanced or repaid.

“With the healthcare marketplace moving rapidly toward reimbursement based on quality and cost-effectiveness, our physician customers need access to deep clinical, operational and information technology capabilities to create integrated networks that continually enhance the quality of care in a cost-efficient manner,” said Bruce Broussard, US Oncology’s chief executive officer. “In joining McKesson, we are building the scale and expertise necessary to empower our customer base to shape the future of healthcare.”

McKesson officials said Broussard will continue to lead US Oncology and the company will remain in Texas, operating under its brand name, as part of McKesson Specialty Care Solutions. The company is currently affiliated with more than 1,300 oncologists nationwide.

“McKesson is committed to improving the health and vitality of our customers, with the ultimate goal of improving the health of patients,” added John H. Hammergren, McKesson’s chairman and chief executive officer. “The combination of US Oncology and McKesson will enhance our ability to achieve these goals in one of the most important segments in healthcare.”

"McKesson and US Oncology's businesses are highly complementary, providing our collective customers access to more services and solutions that will enhance their ability to deliver advanced cancer care," added Paul Julian, McKesson’s executive vice president and group president.

Just last month, US Oncology’s Innovent Oncology division announced a partnership with the Milliman actuarial and consulting firm to develop risk contracting methodologies, including episode rates, bundled payments and capitation. The methodologies will be used to help potential areas where oncologists could improve the quality of care while lowering health costs.

“This investment will prepare US Oncology and physicians in the united network of US Oncology for the future of healthcare as payers consider the alternatives to the fee-for-service model,” said Roy Beveridge, MD, executive vice president and medical director of US Oncology. “The better understanding of cancer care costs and outcomes gained through this investment will build on our strong foundation of deep clinical insight and rich data capabilities.”