Federal judge approves $70 billion dollar merger of CVS and Aetna
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Federal judge approves $70 billion dollar merger of CVS and Aetna

A federal judge found Wednesday that the merger of CVS Health Corp and health insurer Aetna was legal under antitrust law.

Judge Richard Leon of the US District Court for the District of Columbia conducted the review and made the approval in response to a Justice Department decision to allow the merger to go forward. The government’s approval was made under the condition that Aetna would sell away its Medicare prescription drug plan business. This was meant to resolve issues with antitrust law.

Before finally granting the motion to approve the merger conditions, Leon had expressed skepticism that the sale of Aetna’s pharmaceutical business would in fact resolve all antitrust issues.

Leon also expressed disapproval of companies closing large mergers such as this one while judicial review was still underway. Under the 1974 Tunney Act, courts are required to ensure that consent agreements between companies and the Government are “in the public interest.” However, most agreements pass this approval stage with little resistance, and companies tend to close their transactions before the stage is complete. According to CVS, the two companies “have been one company since November 2018” and that Leon’s decision merely confirmed this further.