The CVS-Aetna merger has been one of the longest mergers in healthcare history. On September 4, 2019, the federal judge issued his final ruling approving the proposed settlement of the federal challenge to the merger. The judicial review took eleven months with multiple applications of the “public-interest” test as provided by the Tunney Act.
The ruling finalizes a merger of the nation’s largest pharmaceutical chain with the nation’s third largest health insurance. Both are the largest providers in Medicare Part D arena. To avoid conflict of interests, the settlement requires CVS to divest Aetna Medicare Part D to WellCare.
The judge concluded – after the first-ever live hearing under the Tunney Act – that the two companies will continue to compete despite the merger and the harm to the public was unlikely. (The judge was also focusing on potential harm to HIV and AIDS patients – no such was found). The Judge explained:
“The court’s function is not to determine whether the resulting array of rights and liabilities is one that will best serve society, but only to confirm that the resulting settlement is within the reaches of the public interest.”
As a result, welcome another 800-pound healthcare conglomerate.