The proposed witnesses include executives from CVS, Aetna, and Wellcare, plus consultants with government experience.
CVS Health and the U.S. Department of Justice have named five potential witnesses to testify in favor of the pharmacy chain's Aetna acquisition at a hearing expected this month.
The DOJ approved the CVS-Aetna megamerger last fall, but U.S. District Judge Richard Leon in Washington, D.C., said he wanted to hear from witnesses before deciding whether to sign off on the DOJ's agreement, which prompted Aetna to sell its Medicare Part D business to WellCare Health Plans.
That divestiture is insufficient in the eyes of some organizations that have voiced concerns over the anticompetitive effects the CVS-Aetna deal could bring. Those groups put forward seven witnesses last month who wish to testify against the pending merger.
Attorneys for CVS argued that none of the seven witnesses should be allowed to testify. Both CVS and the DOJ argued that any hearing should be limited to only those topics relevant to the Tunney Act proceeding at hand, rather than allowing "a forum for airing competitors' grievances."
- Michael Radu, MBA, executive vice president of clinical operations and business development for WellCare, plans to testify that Aetna selling its Part D plans to WellCare will likely improve WellCare's competitive stance in the marketplace, according to the DOJ filing. Radu will also testify that WellCare decidedly independently that contracting with pharmacy benefit manger (PBM) CVS Caremark was in its financial interest, the DOJ filing states.
- Nicholas Hill, PhD, MSc, a consultant who worked previously as an assistant section chief in the DOJ antitrust division's economic analysis group and as an economist in the Federal Trade Commission's economics bureau, plans to argue that the divestiture to WellCare is likely to maintain competition in Medicare Part D markets, that moderate levels of market concentration "often do not lead to anticompetitive effects," and that WellCare isn't likely to face vertical foreclosure following Aetna's divestiture, according to the DOJ filing.
- Terri Swanson, vice president of Medicare product and Part D business at Aetna since 2010, is knowledgeable on the nature of Part D competition; Aetna's relationship with its PBM, CVS Caremark; and Aetna's planned divestiture, according to the CVS filing. Swanson was named as a proposed witness in both the CVS and DOJ filings.
- Alan Lotvin, executive vice president of transformation for CVS Health, reports directly to CVS President and CEO Larry Merlo and plans to testify on purported consumer benefits of the CVS-Aetna deal, according to the CVS filing.
- Lawrence Wu, PhD, president of the economic consulting firm NERA, is expected to testify that the CVS-Aetna transaction won't lead to price increases for consumers, based on economic modeling used to assess vertical mergers, according to the CVS filing.
Now it's up to Leon to decide who, if anyone, he will let testify as he mulls whether to sign off on the DOJ's terms.
Steven Porter is an associate content manager and Strategy editor for HealthLeaders, a Simplify Compliance brand.
The DOJ has signed off on the merger, but a judge is thoroughly vetting anticompetitive concerns.
Opponents put forward seven proposed witnesses last month. Now proponents are proposing five of their own.