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Medco merger may mean $3 million for UNC Health's Roper

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For William Roper, CEO of the UNC Health Care System, the mega-merger of Express Scripts and Medco Health Solutions announced this morning could mean a $3 million payday.

Roper, who has been a Medco board member for nearly four years, will receive cash and Express Scripts stock worth as much as $3 million for Medco shares and options he owns.

But he also may lose his Medco board seat. That's a job that paid him total compensation worth $272,789 last year, according to a Securities and Exchange Commission filing.

Two "independent" Medco directors will join an expanded Express Scripts board when the deal closes, but the companies haven't picked them, said Medco spokesman Lowell Weiner. Medco listed eight independent directors in an April SEC filing, including Roper.

Roper has faced criticism over his Medco board work, and whether UNC Health does enough to disclose potential conflicts of interest and his compensation.

UNC Health is reviewing its conflict of interest policies and expects to adopt new standards this year that will lead to more disclosure, said spokeswoman Karen McCall.

Roper declined to comment. He made $717,600 at UNC Health last year, and $483,949 as a director of another publicly traded company, DaVita.

Express Scripts expects to complete the $29 billion Medco takeover next year, but the deal faces tough scrutiny from federal antitrust regulators. The union will form the country's largest pharmacy benefits manager.

As of April, Roper owned 19,965 Medco shares, the company reported in its SEC filing. The Medco takeover also will likely allow Roper to cash in 24,200 options he held as of Dec. 25.

Medco investors will receive $28.80 in cash and 0.81 of an Express Scripts share for each Medco share they own. That works out to about $71.36 per share, based on today's stock price.

The final value will be based on the price of Express Scripts stock on the day the deal is done.

Read an AP report on the merger here.

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Who's reporting leads?

Just as the N&O has censored this story dating back to the time Roper was elected to serve on Medco's board, it will also censor the following comment:

 

Evidenced by e-mails addressing this issue from the News and Observer's very top, John Drescher, who, at the time - this dating back to at least 2009, claimed he didn't see any conflict of interest in Roper's board position on Medco, and then his later stating that his paper would be interested in receiving any leads that would bring any such an issue to public attention, today's report on Roper's deal, in which the paper states:

 

"Roper has faced criticism over his Medco board work, and whether UNC Health does enough to disclose potential conflicts of interest and his compensation," also that "UNC Health is reviewing its conflicts of interest policies and expects to adopt new standards this year that will lead to more disclosure," is nothing more than a farce.

 

Before the present, where has the public read - in the State press, of Roper's relationship with Medco? When have they been informed there was criticism over the same?

 

John Drescher should resign for having suppressed information the public should have known about long before this. 

Independent? Yeah, sure!

Independent director is an oxymoron, and the SEC and Congress are moronic to allow continued conflicts of interest that exist on boards of public companies. In more cases than not, independent directors (and salary advisory committees) usually serve the interests of management rather than shareholders. 

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About the blogger

Assistant Business Editor Alan M. Wolf joined the N&O in 1999 covering the business of health care. He became an editor in 2001, and helps oversee the paper's daily business coverage and Sunday Work&Money section. He lives in Clayton with his wife and two children. Reach him at 919-829-4572 or e-mail him.
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