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WASHINGTON -- A merger already approved by the Justice Department is undergoing an extremely rare hearing in federal court. U.S. District Judge Richard Leon is reviewing the proposed settlement that would allow the merger of CVS Health and Aetna to determine if uniting the two companies is in the public interest.
CVS Health, the largest retail pharmacy chain and one of the two largest pharmacy benefit managers (PBM), bought Aetna, the third-largest health insurer in the United States, for about $70 billion last November. Judge Leon specifically has expressed concern about the merger’s effects on PBM markets, and therefore the price of medicines.
“If this merger goes through, we’ll all have to deal with higher prescription drug prices, less consumer choice, and a lower quality of vital health services,” said Adam Garber, U.S. PIRG’s Consumer Watchdog, who recently co-authored a report on drug prices. “This hearing should make that clear and convince the government to reassess its approval of this merger.”
U.S. PIRG filed a joint brief with Consumer Action arguing that the court should hold the hearing to determine if the merger is in the public interest. The American Medical Association and the AIDS Healthcare Foundation filed similar amici curiae (friends of the court) briefs.
During the three-day hearing from June 4 to 6, expert witnesses will testify on behalf of those groups. Dr. Diana Moss, the president of the American Antitrust Institute, will represent U.S. PIRG.
“We should all applaud Judge Leon for holding this important hearing rather than simply rubber-stamping the proposed settlement,” said Mike Landis, U.S. PIRG’s litigation director. “The health care market is already too consolidated. There’s no way that a vertical merger of two companies this size, which allows them to control the supply chain from top to bottom, will help Americans stay healthy -- in their bodies or their bank accounts.”
U.S. PIRG is the federation of state Public Interest Research Groups. PIRGs are non-profit, non-partisan public interest advocacy organizations that stand up to powerful interests whenever they threaten our health and safety, our financial security, or our right to fully participate in our democratic society.
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