Judge Raises Concerns Over CVS-Aetna Merger

December 5, 2018

Richard Leon, a federal judge of the US District Court for the District of Columbia, has been asked to sign off on the government’s decision to approve CVS Health Corp’s acquisition of health insurer Aetna Inc. However, Mr Leon has yet to sign off on the merger as he said he was “less convinced” than the government that the companies had completed a deal that was legal under antitrust law.

"At this stage, I am less convinced of the sufficiency of the government's negotiated remedy than the government is," according to Mr Leon’s order that was issued on Tuesday.

In an effort to clear any antitrust issues, Aetna sold its Medicare Part D business to a WellCare subsidiary prior to the megamerger closure last week. However, Mr Leon appeared to have an issue with this aspect of the deal. According to a transcript from the court proceedings, Mr Leon said, “I am concerned that your complaint raises anti-competitive concerns about one-tenth of one percent of this $69 billion deal."

Although the Department of Justice signed off on the deal after Aetna sold its business, a judge is still needed to sign off on the agreement between the combined entity.

Mr Leon has asked the government and the companies to file a brief that shows why their integration should not be halted by December 14, 2018.

The next hearing will be held on December 18, 2018.

Julie Gould

For articles by First Report Managed Care, click here

To view the First Report Managed Care print issue, click here