WASHINGTON — The Department of Justice (DOJ) this month gave preliminary approval for CVS Health’s acquisition of Aetna Corp., which both companies say will remake health care. The remaining hurdle to the $69 billion merger was cleared last month when Aetna agreed to sell its Medicare Part D drug plan business to WellCare Health Plans. Antitrust regulators had reservations about the overlap between CVS health’s and Aetna’s Part D plans. The DOJ made final approval of the deal conditional upon the sale by Aetna.
The divestiture “resolves competition concerns posed by this transaction and preserves competition in the sale of Medicare Part D prescription drug plans for individuals,” said assistant attorney general Makan Delrahim of the Justice Department’s Antitrust Division — allowing “for the creation of an integrated pharmacy and health benefits company that has the potential to generate benefits by improving the quality and lowering the costs of the health care services that American consumers can obtain.”
The transaction, which is also subject to state regulatory approvals, many of which have been granted, is on track to close in the early part of the current quarter.
“DOJ clearance is an important step toward bringing together the strengths and capabilities of our two companies to improve the consumer health care experience,” said CVS Health president and chief executive officer Larry Merlo. “We are pleased to have reached an agreement with the DOJ that maintains the strategic benefits and value creation potential of our combination with Aetna. We are now working to complete the remaining state reviews.”
In other news regarding the merger, CVS Health announced three additional Aetna directors with deep insurance company oversight experience — Edward Ludwig, Fernando Aguirre and Roger Farah — will join the CVS Health board following the completion of its acquisition of Aetna. These appointments, together with the previously announced addition of Mark Bertolini, Aetna’s current chairman and chief executive officer, will bring the total number of CVS Health board members to 16.
CVS Health also announced that following the completion of the transaction, Eva Boratto, currently CVS Health’s executive vice president and controller and chief accounting officer, will become executive vice president and chief financial officer.