introduced it might purchase Aetna for about $69 billion in money and inventory. The deal would mix CVS’ drugstores and pharmacy advantages supervisor platform with Aetna’s insurance coverage enterprise, blurring historically distinct traces in hopes of decreasing prices.
The 2 corporations held particular conferences on Tuesday for shareholders to vote. Based on preliminary outcomes, greater than 98 p.c of CVS shareholders’ ballots and 97 p.c of Aetna shareholders’ ballots had been in favor of the deal, the businesses stated in separate press releases.
The 2 now want the Division of Justice to approve the deal. They anticipate the transaction to shut within the second half of the yr.
“When this merger is full, the mixed firm will likely be well-positioned to reshape the patron well being care expertise, placing folks on the heart of well being care supply to make sure they’ve entry to high-quality, extra inexpensive care the place they’re, after they want it,” CVS Well being CEO Larry Merlo stated in a press release.
The deal comes because the retail and health-care industries are coming underneath strain. Drugstores like CVS are discovering fierce competitors from e-commerce, significantly Amazon, which CNBC has reported to be all for promoting pharmaceuticals. It already sells over-the-counter medicine, together with an unique line of Perrigo merchandise.
Well being-care corporations, together with insurers, are trying to find methods to decrease prices. Well being spending equals 18 p.c of the nation’s gross home product, and that quantity is predicted to succeed in 20 p.c by 2025.
Amazon CEO Jeff Bezos, J.P. Morgan CEO Jamie Dimon and Berkshire Hathaway CEO Warren Buffett have even joined the health-care house. They’re partnering to attempt to sort out the “hungry tapeworm on the American financial system,” as Buffett dubbed health-care prices in January.
Because the CVS-Aetna deal was introduced, grocer Albertsons stated it might purchase drugstore chain Ceremony Assist. Pharmacy retailer Walgreens Boots Alliance was reportedly contemplating shopping for the remainder of the wholesale drug distributor AmerisourceBergen it does not already personal, however talks have cooled.
And final week, well being insurer Cigna stated it hopes to amass pharmacy advantages supervisor Categorical Scripts, turning into the newest instance of convergence within the sector.
CVS and Aetna have touted their mixture as a method to make use of CVS’ retail shops to assist rein in health-care prices. They’re hoping to get extra folks into their walk-in clinics at drugstores and maintain them out of costlier websites like emergency rooms.
“The mix of CVS Well being and Aetna brings collectively two complementary companies with an expanded set of distinctive capabilities to create a brand new community-based open well being care mannequin that’s simpler to make use of and cheaper for customers,” Merlo stated in a press release.
Merlo and Aetna Chairman and CEO Mark Bertolini instructed CNBC that the deal will cut back prices for customers instantly.
Throughout the subsequent yr or so, CVS and Aetna anticipate MinuteClinics to carry out about 90 p.c of companies offered in main care services, up from about 40 to 45 p.c now, Thomas Moriarty, CVS’ govt vp, chief coverage and exterior affairs officer, and basic counsel instructed a congressional panel final month.
The Justice Division requested extra info from the 2 corporations final month, however CVS’ Merlo stated the businesses constructed that into the timeline and nonetheless anticipate the deal to shut within the second half of the yr. CVS reiterated that expectation Tuesday.
Shares of CVS dipped zero.6 p.c and Aetna shares gained zero.2 p.c.