"We are pleased that the Department of Justice has cleared our transaction and that we are another step closer to completing our merger and delivering greater affordability, choice and predictability to our customers and clients as a combined company", said David Cordani, president and chief executive officer of Cigna, in a statement.
Cigna said it looked to buy a pharmacy benefit manager because the pharmacy benefit is used nearly twice as frequently as the next closest health care benefit and represents about 20 percent of employer-based insurance benefits.
Cigna and Express Scripts said 16 states have approved the merger already. These were Aetna's thought to develop smaller USA properly being insurer Humana Inc (HUM.N) for $37 billion, and a deliberate $54 billion combination of insurers Anthem Inc (ANTM.N) and Cigna.
Antitrust enforcers signed off on Cigna Corp.'s $54 billion takeover of pharmacy-benefits manager Express Scripts Holding Co., clearing one of two health care deals that stand to reshape the industry.
They continue to expect the deal to close by the end of the year, subject to the satisfaction of all closing conditions.
In the news announcement Monday, Express Scripts CEO Tim Wentworth reiterated that combination of the companies would "be able to do even more to reduce healthcare costs, expand choice, and improve patient outcomes" and "transform healthcare".
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"Both companies argue that the merger will benefit consumers by allowing Cigna and Express Scripts to better manage their customers' health by sharing information about both their medical and drug expenses".
The antitrust regulators said that, in particular, they analyzed whether the merger would substantially lessen competition in the sale of PBM services or raise the cost of PBM services to Cigna's health insurance rivals.
Aetna and Cigna, however, were determined to seek growth through deals while responding to a changing healthcare landscape, eventually targeting mergers with the nation's largest pharmacy benefit managers (PBMs). "... The Justice Department review of CVS's planned purchase of Aetna may conclude this month, but will take longer because of divestitures needed to resolve competitive concerns, a source familiar with the matter told Reuters".
The Justice Department's approval of the Cigna-Express Scripts deal did not come as a shock. Cigna and Express Scripts shareholders voted to approve the firms' merger last month, despite opposition from activist investor Carl Icahn, according to CNBC.
Icahn said Cigna's "likely standalone value" is $215 a share and Express Scripts should be valued at less than $60 a share. Approval by the Justice Department smooths the way for the deal to wrap up by the end of the year, the companies said Monday in a joint statement. Express Scripts countersued the insurer, which represents about a fifth of its revenue.