Cigna-Express Scripts, CVS-Aetna mergers close to DOJ approval

The U.S. Department of Justice is reportedly close to approving health services organization Cigna Corp’s (CI) acquisition of Express Scripts, the largest pharmacy benefit management company of the country. Reports from reliable sources also suggest that the Justice Department is close to approving the healthcare company, CVS Health Corp.’s (CVS) acquisition of health insurer Aetna Inc. (AET).

Sources cite that the two health-care industry related merger deals could receive a formal antitrust approval from the Justice Department in the next few weeks.

The federal executive department regulators have identified concerns regarding the deal valued around USD 70 billion and has ordered Aetna and CVS to sell off assets related to Medicare drug coverage to resolve the competitive issues.

A CVS spokesperson said that Larry Merlo, CEO of CVS Health Corp. previously claimed during a call with a financial analyst that the company has anticipated a range of possibilities in the Medicare Part D business where both Aetna and CVS offer plans. Merlo added both the companies have determined that the impact of possible divestitures would not have any undesirable influence on the deal model.

Meanwhile, the approval of the USD 54 billion acquisition of Express Scripts by Cigna could be passed without selling of any assets, sources familiar with the deal cited.

Reportedly, after the announcement, CVS shares were raised by nearly 0.9%, while shares of Aetna gained 1.6%. In addition, share of Express Scripts surged 4%, while Cigna shares fell by 0.6%.

As per an Express Scripts spokesperson, the company continues to work positively with the Department of Justice and is seemingly confident about the deal’s closure by the end of the 2018. A Cigna spokesperson reportedly commented that the company is cooperating with the DOJ and is prepared to discuss the benefits of the Express Scripts transaction.