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Analysis

5 States Reiterate Support for CVS-Aetna Deal

By Steven Porter  
   May 21, 2019

The states involved in the case are asking the judge for 10 minutes to speak during a hearing early next month.

Five state attorneys general who joined federal antitrust regulators in approving CVS Health's Aetna acquisition have urged the federal judge overseeing the transaction not to forget about them.

California, Florida, Hawaii, Mississippi, and Washington have been coplaintiffs with the U.S. Department of Justice since they filed a complaint in federal court last October to enforce a conditional approval of the CVS-Aetna deal, which requires the divestiture of Aetna's Medicare Part D plans to WellCare Health Plans.

While amici curiae have argued U.S. District Judge Richard Leon should reject the deal, the DOJ and CVS have argued the stipulated agreement is sufficient to alleviate any anticompetitive concerns raised by the nearly $70 billion merger. A hearing with six witnesses—three each from the amici and DOJ/CVS positions—is scheduled for early next month, after Leon said he wished to hear more testimony before deciding whether to sign off on the parties' proposed final judgment.

Now the five states involved in the case are asking Leon to give them 10 minutes to speak during the hearing, according to court records.

Related: Judge Picks 6 Witnesses, Sets CVS-Aetna Hearing Date

"Plaintiff States bring a unique local perspective to our joint investigations with our federal counterparts when evaluating the merger's effects on the marketplace," their filing states. "Healthcare markets are of particular concern to state attorneys general in part because many of the effects of healthcare mergers are local, rather than national."

"Additionally, the states provide and fund healthcare for many of its citizens," the filing adds.

The states noted that they investigated the CVS-Aetna merger for 11 months in close collaboration with the DOJ. At the conclusion of that investigation, they there were anticompetitive concerns with the merger and that the proposed divestiture would be sufficient to address those concerns, which is the same conclusion reached by DOJ investigators.

The states, therefore, intend to urge Leon to greenlight the DOJ-approved CVS-Aetna merger.

Related: CVS Health Picks Up 367 More Hospital Customers With Premier Deal

Related: Aetna Wins Arbitration Appeal, to Pay HCA Hospitals $86M

Related: Megamergers Take Center Stage in M&A Activity

Steven Porter is an associate content manager and Strategy editor for HealthLeaders, a Simplify Compliance brand.

Photo credit: Originally named Consumer Value Store, CVS Pharmacy is now a subsidiary of the American retail and health care company CVS Health. San Carlos, CA - Aug. 19, 2016. CVS Pharmacy. (Editorial credit: jejim / Shutterstock.com)


KEY TAKEAWAYS

The DOJ was joined by five coplaintiffs when it filed suit to enforce its conditional approval of the megamerger.

The states agree with the DOJ in saying the CVS-Aetna deal should be approved.

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