The Department of Justice—not the Federal Trade Commission—is reportedly the top contender to review CVS’ proposed purchase of Aetna, which is a potential setback for the $69 billion deal.
Citing anonymous sources from Washington, D.C., the New York Post reported that the DOJ will likely be the agency to review the deal since the FTC is missing three out of its five customary commissioners.
The DOJ also has the benefit of the expertise it gained from reviewing the Aetna-Humana deal, the article noted. Regulators sued to block that deal—and Anthem’s bid to acquire Cigna—and won both cases in federal court.
On the plus side for CVS and Aetna, CNN has reported that new DOJ antitrust chief Makan Delrahim previously lobbied on behalf of Anthem during its attempted takeover of Cigna. Yet Delrahim also directed the agency to challenge the AT&T-Time Warner deal—a vertical transaction that has a lot in common with the CVS-Aetna tie-up.
That is perhaps why one source told the Post that the two companies would have preferred the FTC to review their deal. The FTC typically reviews mergers of retail businesses like CVS, while the DOJ usually handles health insurer mergers, noted a Bloomberg article.
Meanwhile, the CVS-Aetna deal has already raised the hackles of some Democratic lawmakers. New Jersey Democrat Frank Pallone Jr., the ranking member of the House Energy and Commerce Committee, has requested a hearing on the proposed acquisition.
“As the business of healthcare continues to morph, it is critical that Congress closely examine the changing relationships among healthcare entities and the impact these changing relationships have on the way healthcare is delivered in this country,” Pallone wrote in a letter to Committee Chairman Greg Walden, R-Ore.
“Due to the scale of the CVS Health-Aetna merger, these changes should be thoroughly scrutinized and understood by the members of this committee,” he added.
Sen. Tim Kaine, D-Va., a member of the Senate Health, Education, Labor and Pensions Committee, also said he wants that committee to hold a hearing on the proposal, The Hill reported.