US health insurer Cigna is to buy pharmacy benefits manager Express Scripts Holding for about $54 billion.

The deal reflects pressure on US healthcare companies to grow bigger in order to cut costs. 

The move follows the $69-billion merger of insurer Aetna and one of Express Scripts' biggest rivals, CVS Health, announced last December. 

The companies said the combination will save $600m due to administrative efficiencies. They can cut costs as they better coordinate pharmacy and medical claims. 

The deal could also increase their leverage in price negotiations with drugmakers. 

Cigna's offer consists of $48.75 in cash and 0.2434 shares of stock of the combined company for each Express Scripts share, amounting to $96.03 per share. 

That represents a premium of nearly 31% to Express Scripts' closing price yesterday. 

The transaction is valued at $67 billion, including about $15 billion in Express Scripts' debt, the company said. 

Pharmacy benefit managers administer prescription drug programmes for health insurers, self-insured companies and government agencies.

They negotiate deals with drug manufacturers and work with pharmacies and processing claims.

Investors had expected Cigna to do a deal after its proposed acquisition by Anthem was blocked by competition regulators two years ago. 

The ExpressScripts combination would put the Cigna model closer to that of UnitedHealth Group, the industry's biggest health insurer. 

Cigna currently uses UnitedHealth's Optum division to manage its pharmacy benefit, and will likely lose that business, analysts said. 

The wave of consolidation in the sector also comes against the backdrop of a shifting landscape, including changes in the US Affordable Care Act, rising drug prices and the threat of competition from Amazon.com.

Amazon, Berkshire Hathaway and JPMorgan Chase & Co said in January they would form a company to cut health costs for hundreds of thousands of their employees.