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American Medical Association opposes CVS-Aetna merger


The American Medical Association urged the US Justice Department (DOJ) to stop the merger between CVS and Aetna on Wednesday.  

The doctors’ group has consistently warned that the deal could limit competition, driving up prescription prices, especially for older Americans.     

A merger between the companies would increase concentration in 10 of the 34 Medicare Part D regional markets to the point where it is presumed likely to increase market power, according to the AMA. 

CVS and Aetna have claimed that they operate in different sectors and are not competitors, but the AMA is working to convince the DOJ otherwise. 

CVS plans to acquire Aetna in a $69 billion deal, but the nation's largest doctors' group, the American Medical Association is begging the Department of Justice to block the deal 

CVS plans to acquire Aetna in a $69 billion deal, but the nation’s largest doctors’ group, the American Medical Association is begging the Department of Justice to block the deal 

The two companies ‘operate as rivals in some of the same markets, raising substantial concerns,’ said AMA President Barbara McAneny in a statement.

Since December, the AMA has been analyzing the possible fallout from the merger. 

CVS and Aetna are each at the top of their respective markets. 

Both companies have argued that their is a ‘vertical merger,’ meaning that they operate in separate be related commercial spaces. 

Supporters have argued that because CVS – a pharmacy benefit manager (PBM) – and insurer Aetna do not directly compete, their combination could offer an innovative model and drive competition in the healthcare space.  

But others, including the AMA, the nation’s largest association of doctors, believe that the partnership will offer a one-stop-shopping experience and prices that neither insurers nor PBMs can keep up with.   

This is largely because each company holds a dominant position in its respective industry.  

What’s more, PBMs have traditionally benefited from trying to keep prices down for patients, which may mean getting the insurers to pick up more of the cost.  

McAneny said the merger would mean higher prices, less choice and stifled innovation in PBM services, health insurance and pharmacy services. 

CVS said in a statement that it strongly disagreed with the AMA’s assessment of the deal.

‘We believe that competition within each of the business segments in which we operate – pharmacy benefit management, pharmacies and insurers – is fierce and will remain so,’ the company said in a statement.

But the AMA insists that ‘federal and state antitrust officials now have powerful reasons to block this harmful merger and foster a more competitive marketplace that will operate in patients’ best interests,’ said Dr McAneny. 



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