One of the biggest middlemen in the drug industry is losing their largest customer -- and the stock is tanking

Express Scripts, on of the largest pharmacy benefit manager’s (PBM) in the drug industry, announced on Monday that its largest customer will not renew its contract with the company.

Anthem, owner of a variety of Blue Cross Blue Shield health insurance firms, said it will not renew its deal with Express Scripts according to an earnings release from the PBM.

As a health insurer, Anthem contracts with pharmacy benefit managers like Express Scripts to help negotiate lower prices for prescription drugs in the form of a rebate from the pharmaceutical company.

Anthem accused Express Scripts of not passing along those savings, claiming Express Scripts overcharged the insurer by billions of dollars.

“Although conversations have been ongoing, the Company was recently told by Anthem management that Anthem intends to move its business when the Company’s current contract with Anthem expires on December 31, 2019, and that Anthem is not interested in continuing discussions regarding pricing concessions for 2017-2019 or in receiving the Company’s proposed pricing for the period beyond 2019,” said the release from Express Scripts.

According to the release, the Anthem contract was responsible for roughly 18% of Express Scripts’ first quarter 2017 revenue.

Following the news, Express Scripts stock dived more than 10% as of 5:05 p.m. ET.

NOW WATCH: Animated map of what Earth would look like if all the ice melted

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.