An Aetna shareholder is suing the company for allegedly shortchanging stockholders in documents related to a $69 billion deal with CVS Health. The pharmacy chain's bid to acquire Aetna is valued at $77 billion when assumption of the payer's debt is included.
Olivier Miramond claims a January filing with the U.S. Securities and Exchanges Commission included “materially incomplete and misleading information." Her lawsuit aims to block a shareholder vote on the deal.
Aetna's filing included information about the merger agreement, but Miramond’s lawsuit said the filing didn't provide information allowing stockholders to make an informed decision about whether the deal is fair.
The lawsuit, which requests that the court block Aetna from holding a shareholder vote on the CVS Health deal, comes a month after the two companies announced a definitive agreement. CVS expects the acquisition will close by the second half of the year, but it may stretch into 2019.
The shareholder lawsuit is an early hurdle, but will not be the only one. Aetna and CVS can expect close scrutiny from regulators on antitrust concerns, given the size of the two companies.
The CVS-Aetna deal has industry leaders wondering about the move’s impact on healthcare. CVS has a retail footprint that other payers don’t enjoy as well as a customer base. What it doesn't have is relationships with providers, but bringing in Aetna ticks that box for the retail pharmacy giant.
Moody’s Vice President Micky Chadha recently said the deal “will mark an industry shift toward a more seamless approach to managing healthcare costs as it brings together the overall management of a patient’s medical bills and prescription drugs under one umbrella.”
Analysts from Fitch Ratings agreed. “Vertically integrated entities are better positioned to manage care and patient outcomes while controlling costs,” said Fitch Ratings.
However, there are risks if the merger is not carried out smoothly.
Maulik Bhagat, managing director in the healthcare practice of global consultancy AArete, recently highlighted one potential hurdle to Healthcare Dive.
“For example, a key to deriving synergies from such a merger is effective data integration and possibilities from resultant advanced data analytics — but that is easier said than done.”
Heading into 2018, CVS Health is positive beyond the proposed merger. CVS Health said earlier this month that the tax cut approved at the end of 2017 will bring about $1.2 billion in annual net income and cash flow. That money will go toward investments in future growth areas, such as its deal with Aetna.
While the healthcare industry awaits how the CVS-Aetna deal shakes out, leaders are also watching for players like Apple and Amazon to potentially enter the healthcare space.
David Blumenthal, president of the Commonwealth Fund, recently said in a recent op-ed that major companies moving into the industry won’t lead to a quick fix.
“It can take generations for a provider-insurer partnership to develop a culture of trust, collaboration, and value orientation that has made existing examples of these combinations so uniquely effective,” he said.