US judge approves CVS purchase of Aetna insurer

A federal judge reviewing a Justice Department decision authorizing the US pharmacy chain and benefits manager CVS Health to merge with health insurer Aetna said Wednesday that the deal was in fact legal under the law of the United States. competition.

Judge Richard Leon, of the US District Court of Columbia, was reviewing a government plan announced in October to allow the merger, provided that Aetna sells his Medicare prescription drug plan business to WellCare Health Plans. Both offers are already closed.

Leon had initially hesitated to approve the terms of the merger and had insisted on hearing the critics of the agreement, but had finally decided to grant the motion for approval of the consent. But it went against the common practice of concluding multi-billion dollar contracts while the judicial review process, required by the Tunney Act, was still ongoing.

"If the Tunney Act means something," writes Leon, "this certainly means that no court should endorse a consent decree approving the merger of" one of the largest companies in the United States " and the "third largest health organization in the country" insurance company, "… just because the government is asking for it!"

In December, Leon said he was "less convinced" than the government that selling assets to WellCare would solve antitrust issues. Since then, Centene has agreed to acquire WellCare for $ 15.27 billion. CVS stated that the judge's decision reinforced the fact that CVS and Aetna had already merged.

"CVS Health and Aetna have been one and the same since November 2018, and today, the actions of the court of appeal make clear that we remain focused on transforming the consumer experience into one." health care in America, "said CVS spokesperson TJ Crawford said in a statement by e-mail.

The Department of Justice did not immediately respond to a request for comment.

Among the critics of the CVS-Aetna agreement were the American Medical Association and the AIDS Healthcare Foundation.

Pending the approval of Leon, CVS has agreed to temporarily allow Aetna to autonomously make critical product, pricing and personnel decisions.

CVS is in the process of becoming a health care company and announced in June that it would offer more extensive health services, such as nutrition counseling and blood pressure screenings, in 1 500 stores here by the end of 2021.

Most consent agreements to strike antitrust agencies with companies to resolve competition concerns are approved by the federal courts without much difficulty under the 1974 Tunney Act, which requires courts to ensure that agreements are in accordance with the public interest.

Companies usually do not wait for the court's final approval before closing their transactions.