Shares of Diplomat Pharmacy (NYSE:DPLO) are up 16% as of 12:25 p.m. EDT after the company announced that Brian Griffin will become the new CEO and chairman of the board, effective next month.
The news isn't surprising. Earlier this week, Diplomat said it was focused on an external candidate and that chief financial officer Atul Kavthekar was temporarily taking over as interim CEO for Jeff Park, who will resign as interim CEO, effective tomorrow.
Brian Griffin is currently CEO of IngenioRx, the pharmacy benefit manager (PBM) of Anthem. Given Diplomat's move into the PBM space with recent acquisitions of National Pharmaceutical Services and LDI Integrated Pharmacy Services, Griffin seems like a good fit to replace Phil Hagerman, who retired in January. Griffin also worked at PBM Express Scripts, and his prior experience at Anthem in its commercial and specialty business division and Empire BlueCross BlueShield health plan could be helpful in negotiations with insurers for the rest of Diplomat's business.
Griffin is being replaced by IngenioRx's chief operating officer, Deepti Jain, so it's in familiar hands.
With shares well off their lows that followed the announced acquisitions, investors have clearly decided that the move into the PBM business is a good long-term strategy. Now that things in the leadership position have finally settled down, the company can get to work making the transition.