CVS on Sunday said it planned to buy Aetna for $69 billion.
Merlo added during the conference call that rising health care costs are a major problem for consumers and that the combination of CVS and Aetna will lead to lower expenses and better service for consumers and health care providers.
One of the few areas where the companies directly overlap is in the Medicare drug business.
The deal, announced Sunday evening, will push the drugstore chain more forcefully in a direction it has been heading for years, according to Wall Street analysts. The clinics also provide services that can't be purchased online. "With the analytics of Aetna and CVS Health's human touch, we will create a health care platform built around individuals".
The mammoth acquisition pairs a company that runs more than 9,700 drugstores with an insurer covering around 22 million people. The Coalition to Protect Patient Choice said that "mergers like these have a dismal history", adding, "consumers suffer by paying more and getting less choice for the vital drugs they need". "If you think about it, we actually don't have anything like that", Jefferies analyst Brian Tanquilut said recently. A clinic visit also can be cheaper than a $100 doctor visit for someone who doesn't have insurance, but they have drawbacks.
A CVS Pharmacy Store in the city of Fort Worth.
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Jessy Tatenco, 23, buys household items and over-the-counter medications for his three children at CVS.
The deal "would definitely be scrutinized, but ultimately we still see a path for it to get through", Newshel said in an email. "They're expanding the retail clinics so they won't be quite urgent care, but they'll resemble a direct primary care facility". "Many are pushing for more health care services to happen in pharmacies, and this is one mechanism to make that happen". The nation's largest health insurer also runs clinics and doctor's offices. The deal also will help CVS keep Aeta's business managing the insurer's pharmacy benefits.
What does CVS and Aetna merger. Aetna will have two of its directors, in addition to Aetna CEO Mark Bertolini join the board of CVS.
CVS operates more than 1,100 MinuteClinics at locations in its drugstores and within Target stores. It would also allow CVS to expand its 1,100 walk-in clinics, saving Aetna's insurance customers money by steering patients away from expensive hospital emergency rooms. Earlier this year, Aetna dropped a $34-billion bid for rival insurer Humana after a federal judge blocked the deal on antitrust grounds.
That doesn't mean there's heightened hostility toward vertical deals at the Justice Department, but CVS might prefer the Aetna deal to go to the FTC given Delrahim's criticism of behavioral fixes, said David Kully, an antitrust lawyer at Holland & Knight in Washington and a former Justice Department attorney. Some of that business may have to be sold to address antitrust concerns.
Wary of Amazon's much-rumored move into the pharmacy industry, the leaders of CVS and Aetna have met several times this year, conversations that eventually led to deal negotiations.