A judge has finally approved the CVS-Aetna merger involving CVS taking over the insurance provider for $70 billion.
Despite concerns that the merger will diminish competition, the justice department had in fact already approved the deal last year upon the condition that Aetna's Medicare drug business would be sold so as to even the playing field.
"CVS Health and Aetna have been one company since November 2018, and today's action by the district court makes that 100 percent clear," CVS said in a statement. "We remain focused on transforming the consumer health care experience in America."
In retaliation, the American College of Rheumatology expressed concerns over the merger potentially threatening transparency and raising drug costs. Their claims rest on the fact that certain manufacturer rebates are hidden from consumers, and are thereby part of a chain of secretive practices that ultimately drive up costs for consumers.
"Though PBMs claim to use their position to negotiate lower drug prices, there has been no proof that rebates have been used to reduce the burden on patients and the health care system at large," said Angus Worthing, MD, chair of the ACR Government Affairs.
"State legislation has included gag clause bans, restrictions on claw-back provisions in PBM-insurer contracts, licensure of PBMs in states where they operate and provisions that protect community pharmacies from unfair PBM auditing practices," he added. "These are positive developments, but without the full disclosure of rebates and discounts it is not possible to determine how the rebate system impacts drug prices and patient costs."
The Judge has stated that pressure groups that stood against the merger could not comprehensively prove that the deal would actually endow CVS with an advantage and allow it to divert patients from their current providers.
"The markets at issue are not only very competitive today, but are likely to remain so post-merger," he wrote. "Consequently, the harms to the public interest the [opponents] raised were not sufficiently established to undermine the Government's conclusion to the contrary."
Moving forward, it is unlikely that there will be any changes made to the merger given that antitrust experts claim that judges making any changes to mergers such as this one has been unprecedented in the past. An eye will have to be kept on pressure groups such as the American Medical Association (AMA), especially if this deal becomes a bellwether for more to come.