The Antitrust Division of the US Department of Justice has given the all clear to the merger of Cigna Corporation (Cigna) and Express Scripts Holding Company (Express Scripts). The proposed merger was first announced in March 2018. The $67 billion deal will combine one of the nation’s largest health insurers and one of its most dominant pharmacy benefit managers (PBM). The DOJ approved the deal following review of over 2 million documents, ultimately concluding that the merger wouldn’t harm competition in either the PBM or insurance markets. The companies have asserted that the integration of the health insurance and PBM functions will enable them to meet consumer and government demands for greater cost control in the health sector.
“We are pleased that the Department of Justice has cleared our transaction and that we are another step closer to completing our merger and delivering greater affordability, choice and predictability to our customers and clients as a combined company,” said David Cordani, President and Chief Executive Officer of Cigna in a press release. “The value that we deliver together will help put our society on a far more sustainable path – one that helps health care professionals close gaps in care and supports our customers along their health journey.”
“Together, we believe we will be able to do even more to reduce healthcare costs, expand choice, and improve patient outcomes,” said Tim Wentworth, President and Chief Executive Officer of Express Scripts. “Today’s decision is one more important milestone in our effort to combine two innovative health services leaders into a company that will transform health care.”
While completion of the transaction remains subject to a number of state regulatory approvals and filings, to date, Cigna and Express Scripts have already obtained clearances from departments of insurance in 16 states. The companies announced that they are working with regulators in the remaining jurisdictions to obtain the necessary clearances for the merger and expect that the deal will close by the end of 2018.
Waiting in the wings is yet another healthcare mega-deal, the acquisition of Aetna by CVS Health, which the DOJ is reportedly close to approving. This, combined with the proposed entry of Amazon, Berkshire-Hathaway, and JPMorgan Chase into the healthcare marketplace, at least in regard to their own employees, promises to further shakeup the healthcare, health insurance, and pharmacy sectors heading into 2019 and beyond.
The FisherBroyles Pharmacy and Health Care Law team is pleased to keep you updated on events of interest to those in the healthcare and pharmaceutical industries. Questions may be directed to any of the following attorneys: