Does Catamaran Have Healthy Leadership?

Matthew is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.

Even at the fastest-growing pharmacy benefits manager in the country, Catamaran (NASDAQ: CTRX) needs to have healthy leadership to keep growing.  That leadership certainly starts with CEO Mark Thierer, but it doesn’t stop there.  That’s why investors can’t overlook the role that the company’s Board of Director’s plays in guiding the company. 

The company’s board now consists of nine members, having recently added two new members.  Just knowing who’s on the Board and what skill sets they’ll bring to the table is an important first step for any investor.  It’s these individuals who are ultimately responsible to shareholders. 

So, who are they, and how does that matter in the management of the company?  Let’s take a look.

Mark Thierer is the Chairman and CEO of Catamaran.  Mr. Thierer has spent thirty years as a healthcare industry leader at major healthcare firms Allscripts Health Solutions (NASDAQ: MDRX) and CVS Caremark (NYSE: CVS).  

Steven Cosler is a Lead Director at Catamaran.  Mr. Cosler is an operating partner at Water Street Healthcare Partners which is a strategic private equity firm focused solely on the healthcare industry.  Prior to joining Water Street he was the CEO of Priority Healthcare which he led through an IPO, strategic growth and ultimate sale to Express Scripts (NASDAQ: ESRX)

Peter Bensen is the CFO of McDonald's in addition to being on the Board at Catamaran.  He’s served in various financial capacities at McDonald's since 1996.

William Davis is the CFO at Blackboard in addition to being a board member of Catamaran.  Prior to joining Blackboard, Mr. Davis was the CFO of Allscripts where he helped lead several strategic transactions for the company.

Stephen Epstein of Epstein Becker & Green is a pioneer in health care law.  For more than 35 years he’s played a key role in establishing that health care organizations require a dedicated form of legal representation.  He’s known as the “father of the healthcare legal industry.” 

Betsy Holden is one of the newest Catamaran Board members.  She’s a Senior Advisor to McKinsey & Company and works with clients across industries on strategy, marketing, innovation and board effectiveness.  Ms. Holden is formerly the co-CEO of Kraft Foods.

Karen Katen is the other newest Catamaran Board member and is a director at several well-known companies including Home Depot.  She retired as the Vice Chairman of Pfizer in 2006 where she also served as the president of the company’s Human Health/Pharmaceuticals Group.  She’s been named among the rankings of Fortune Magazine’s “50 Most Powerful Women in Business” eight consecutive years. 

Harry Kraemer is an Executive Partner with the private equity firm Madison Dearborn Partners.  He’s the former Chairman and CEO of Baxter International.

Anthony Masso is the President and CEO of Consortium Health Plans which is a national coalition of 19 Blue Cross Blue Shield plans. 

As a shareholder you really have to be proud of this board, at least on the surface.  It’s very balanced though it rightfully is heavily weighted toward healthcare.  More than two thirds of the members have a background in the operations of a health care company. 

Both Mark Thierer and William Davis worked for Allscripts which is a health care technology company.  While Catamaran is now known more for its PBM business, the company’s roots are in healthcare technology.  Having both on the board should ensure that technology continues to play a major role in the future of Catamaran. 

Thierer and fellow board member Steven Cosler have backgrounds in pharmacy benefits management.  Thierer spent 10 years at CaremarkRX (Now CVS Caremark) and played a key role in growing the company into a market-leading PBM.  Meanwhile, Cosler sold his former company to Express Scripts.  Now the two are working together in competing with the very companies they help make stronger.  The inside knowledge of their former firms combined with their overall industry knowledge will be key to growing Catamaran.

The board is very well complimented with experience outside all the healthcare industry.  The board can rely on the extensive financial experience from the CFO’s of McDonald's and Blackboard as well the top notch legal guidance of Mr. Epstein.  Further, the board has several other successful corporate executives and private equity veterans who know how to get a deal done.

One of the often overlooked roles of a board member is to consider a proposed merger agreement.  Catamaran was recently created through the merger of SXC and Catalyst Health Solutions.  SXC had a long history of acquisitions under Mark Thierer’s leadership and that’s likely to continue.  Having several seasoned deal makers on the board will ensure these future acquisitions are good strategic and financial fits.

Overall this appears to be a great Board of Directors.  It’s weighted toward healthcare, but complimented with highly skilled individuals who bring balance.  Catamaran investors should be well taken care of by the company’s healthy board. 

latimerburned owns shares of Catamaran. The Motley Fool owns shares of Catamaran and Express Scripts. Motley Fool newsletter services recommend Catamaran and Express Scripts. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. Is this post wrong? Click here. Think you can do better? Join us and write your own!

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