The state's Department of Financial Services is demanding written evidence from CVS and Aetna that they would deliver on promises to lower prices.
New York state officials are considering blocking parts of the $68 billion merger of drugstore store chain CVS Health Corp. and Aetna Inc., jeopardizing billions of dollars in insurance premiums for Aetna.
CVS and Aetna won approval from the U.S. Justice Department on Oct. 10, contingent on Aetna divesting its Medicare Part D business, which covers prescription drugs for seniors. But the deal still needs to pass through state regulatory bodies.
At a public hearing in Manhattan on Thursday, Maria Vullo, superintendent of the state Department of Financial Services, said her agency might block CVS's merger with Aetna's New York unit. She called U.S. approval of the overall deal “myopic” and repeatedly asked CVS and Aetna representatives for written evidence that they would deliver on promises to lower prices.
Several groups, including the Pharmacists Society of the State of New York and the Medical Society of the State of New York, urged the state to block the deal. They said the merger would limit competition and drive up the cost of prescription drugs. Assemblyman Richard Gottfried, chairman of the Health Committee, said the deal introduces “dangerous trends” in consumer access.
While CVS has said in the past that the merger would result in lower costs for consumers, Elizabeth Ferguson, deputy general counsel for CVS, told Vullo there wasn't a specific plan to lower prices.
CVS and Aetna announced the deal in December 2017 but continue to face regulatory hurdles. Connecticut approved the deal Oct. 17, and the New York will reach a decision after Oct. 25.
Shares of CVS and Aetna were little changed in New York Thursday.
Read more:
- What the CVS/Aetna merger means for health care
- Bucking merger trend, Walgreens doubles down on partnerships
- Cigna-Express Scripts deal cleared by DOJ
Copyright 2018 Bloomberg. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
Complete your profile to continue reading and get FREE access to BenefitsPRO, part of your ALM digital membership.
Your access to unlimited BenefitsPRO content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Breaking benefits news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical converage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
