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Judge says prescription drug market will remain competitive
CVS’s long-sought acquisition of insurance giant Aetna Inc. is now official.
On Wednesday, a federal judge in Washington, D.C., gave final go-ahead for the $68-billion purchase. The ruling lets CVS add a health insurance business to its growing healthcare empire, which also includes a prescription drug benefit program as well as a nationwide chain of retail pharmacies.
The two companies first announced their plan to merge in December 2017. In a statement on its website at the time, CVS said the transaction “fills an unmet need in the current healthcare system and presents a unique opportunity to redefine access to high-quality care in lower cost, local settings whether in the community, at home, or through digital tools.”
In October 2018, CVS agreed to sell Aetna’s Medicare prescription drug business to WellCare Health Plans Inc. in order to satisfy federal anti-trust concerns. But Judge Richard Leon of the U.S. District Court for the District of Columbia stepped in to review the deal, even though it had technically been finalized, saying he wanted to hear from those objecting to it.
In yesterday’s ruling, however, Leon said he was persuaded that competition in the prescription drug market is and will likely remain “highly competitive.”
Among those opposing the merger was the American Medical Association. Its president, Patrice A. Harris, MD, reiterated the association’s objections following the judge’s ruling.
“For patients and employers struggling with recurrent increases to health insurance premiums, out-of-pocket costs and prescription drug prices, it’s hard to find any upside to a merger that leaves them with a fewer choices,” Harris said in a written statement.
“As for promised efficiency savings … CVS made no commitment to pass much-hyped savings onto consumers through lower premiums or drug costs,” Harris added. “We know from history that when health insurance and pharmaceutical benefit management markets are ruled by only a few massive companies, patients pay a steep price.”