Caufield & James, L.L.P Caufield & James, L.L.P

Serving clients statewide, including: Los Angeles, SF Bay Area, Sacramento, Bakersfield, Fresno & San Diego

Call us now toll free:866-585-8944
search Navigation Menu

Health care giants to merge after approval received

People in California may experience a change in how they access health care, as leading pharmacy chain CVS has been granted approval for its merger with health insurer Aetna. The two companies had previously announced their plans to merge, but their path to approval was cleared by the Department of Justice after Aetna announced that it was selling off its Medicare Part D drug plan business. The insurer divested that segment of the company to WellCare Health Plans for an undisclosed sum of money after regulators expressed concerns about an overlap with CVS' Part D plan.

According to the Department of Justice, the divestment of that plan cleared the way for the merger, creating a new integrated pharmacy and health insurance company. CVS is the largest drugstore chain in the country, and it announced that it would pay $69 billion for the insurance firm. CVS not only has a retail business in pharmacy; it also provides benefits management programs through its Caremark unit as well as Medicare Part D plans.

The CEO of CVS said that the newly merged firm plans to combine insurance and pharmacy services to reduce costs at both the corporate and consumer level. Experts said that the pharmacy sector is facing harsh competition from online retail, and that the merger will drive more patients to CVS' urgent-care MinuteClinics, located in the pharmacies. The company announced that additional services would be provided by the walk-in clinics, such as diabetes management and preventive care.

Dealing with acquisitions can be complicated, even when smaller businesses are involved than the pharmacy and insurance giants. Regulatory challenges and negotiating issues with the other party may create some challenges. Throughout the process, a business lawyer's input can be valuable.

No Comments

Leave a comment
Comment Information

Contact us now to begin a confidential case evaluation:

Caufield & James, L.L.P

Bold labels are required.

Contact Information
disclaimer.

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

close

Privacy Policy

[an error occurred while processing this directive]