CVS-Aetna Merger Announced
On December 3, 2017, CVS Health and Aetna announced plans for merger, in which CVS Health will acquire all outstanding shares of Aetna. The merger agreement has been unanimously approved by the boards of both companies.
CVS Health and Aetna touted the benefits of the merger, stating consumers will gain access to a "uniquely integrated, community-based health care experience." One example they provided was that CVS Pharmacies will "include space for wellness, clinical and pharmacy services, vision, hearing, nutrition, beauty, and medical equipment, in addition to the products and services our customers currently enjoy." In addition, "many locations will function as a community-based health hub dedicated to connecting the pathways needed to improve health and answering patients' questions about their health conditions, as well as prescription drugs and health coverage." The press release also included details on plans to integrate data and analytics and help fight chronic diseases.
The Department of Justice will review the merger details, and some speculate that it will sue to block the merger as it did on November 20 with AT&T’s proposed acquisition of Time Warner, arguing that the merger would harm consumers by limiting their options. Bloomberg reports that Aetna Chief Executive Officer Mark Bertolini said Sunday, “We are obviously going to get some scrutiny.... We are prepared to deal with whatever comes along to make this work.”
In addition, some Democrats in Congress, such as Elizabeth Warren and Bernie Sanders, have expressed concerns about the merger. According to The Hill, Senator Tim Kaine, of the Senate Health Committee, said “I hope we can have a hearing on it because I think it might be…an example of things to come, and we might want to get into what it means for the health-care system.”
Aetna is a vendor that we work with closely and provide as an option for our clients. As such, we continuously receive updated information directly from them. We will keep you informed of the details of this merger as we receive news on this matter.
To view the full release, which is available on both companies' websites, please use the hyperlinks below: