- Five attorneys general representing California, Florida, Hawaii, Mississippi and Washington are urging a federal judge to approve the settlement agreement the U.S. Department of Justice struck with CVS Health and Aetna that allowed the two companies to go forward with their blockbuster merger, according to a recent federal court filing.
- The states are also seeking to address the court during a June 4 hearing in which other witnesses will testify, including those speaking on behalf of the American Medical Association, which opposes the deal.
- The state officials said not only do they support the settlement, they will play an important role in enforcing the terms of that agreement as the top law enforcement officials in their respective states.
These are the same fives states that originally objected to the deal and were named as plaintiffs in the initial complaint DOJ brought against CVS-Aetna over the nearly $ 70 billion merger.
Along with DOJ, the five states attorneys general believed the merger would be anticompetitive in 16 Medicare Part D markets across the country. To alleviate that concern, DOJ reached a settlement agreement with CVS and Aetna that required Aetna divest all of its Medicare Part D business before proceeding with the deal. Aetna sold the business to a WellCare subsidiary, allowing the merger to go through.
In their recent filing, the states defended their 11-month investigation of the deal, which they said was conducted alongside DOJ. “At the conclusion of the investigation, Plaintiff States believed, like DOJ, that the horizontal aspects of the merger presented anticompetitive issues and that the proposed divestiture would resolve those issues,” according to the filing.
The five state officials believe, even after reading the briefs from the AMA, the settlement is the best interest of the public and is an effective and appropriate remedy for the initial antitrust concerns they and the DOJ raised.
District Judge Richard Leon is tasked with reviewing the settlement agreement next month. However, Leon has remained skeptical of the deal, previously stating it addresses only “about one-tenth of 1%” of the megamerger.
Despite the holdup in Leon’s courtroom, CVS has already closed on its acquisition of Aetna.