Health Care

What $52B Cigna-Express Scripts deal means for healthcare

What $52B Cigna-Express Scripts deal means for healthcare”

Well being insurer Cigna Corp's (CI.N) $fifty two billion acquisition of pharmacy advantages supervisor Specific Scripts Retaining Co has passed US antitrust scrutiny, the companies acknowledged on Monday, allowing them to proceed with a combination they train will lead to lower funds by better coordinating pharmacy and medical advantages.

"We are pleased that the Department of Justice has cleared our transaction and that we are another step closer to completing our merger and delivering greater affordability, choice and predictability to our customers and clients as a combined company", said David Cordani, president and chief executive officer of Cigna, in a statement.

The companies continue to expect the deal to close by the end of the year, subject to the satisfaction of all closing conditions. Cigna closed up 1.40% yesterday; Express Scripts rose 3.71%.

In particular, the agency said the merger would not lessen competition in the sale of PBM services because Cigna's in-house PBM business is small and at least two other large PBMs and several smaller ones remain in the market.

Cigna's stock was trading upward at $199 by mid-morning Tuesday, and Express Scripts' was trading at $95.59. "The value that we deliver together will help put our society on a far more sustainable path - one that helps health care professionals close gaps in care and supports our customers along their health journey". Express Scripts negotiates prescription drug prices with pharmaceutical companies. Nine more must sign off before they can close the deal, according to a Cigna spokeswoman.

"Quality health care and competitive pricing for health care services and pharmaceutical drugs is critical to USA consumers", Makan Delrahim, an assistant attorney general, said in a statement.

Federal officials on Monday gave the go-ahead to the proposed merger between Cigna, one of the nation's largest health insurers, and Express Scripts, a major pharmacy benefit manager. "The Justice Division overview of CVS's deliberate snatch of Aetna is wrapping up and might per chance per chance moreover produce this month, but will take longer due to the divestitures compulsory to resolve aggressive issues", a offer familiar with the matter immediate Reuters.

Brian Tanquilut, an analyst with Jefferies, said DOJ's decision not to intervene is not surprising "given the lack of overlap between Cigna's business versus Express Scripts".

Regulators spent six months on the investigation, reviewed more than 2 million documents and interviewed more than 100 people from within the industry before reaching their conclusion, DOJ said. But Icahn abandoned his efforts to derail the merger after two independent advisory firms recommended shareholders approve it. Cigna and Express Scripts' investors approved the deal in late August.

Express Scripts is one of three massive pharmacy benefit managers. Visit MarketWatch.com for more information on this news.



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