CVS Health to Buy Aetna for $69 Billion

CVS Health and Aetna have announced that the pharmacy retailer will purchase the health insurance company for $69 billion, according to recent reports.

“This combination brings together the expertise of two great companies to remake the consumer health care experience,” Larry J Merlo, president and CEO of CVS, said in a press release announcing the purchase. “With the analytics of Aetna and CVS Health’s human touch, we will create a health care platform built around individuals.”

The deal is being touted as a step toward patient-centered insurance and pharmacy services that will improve outcomes through integration of care. CVS’ wide network of pharmacy will be utilized to connect providers and patients with pharmacy data—and ultimately reduce the cost of pharmacy spending by synergizing pharmacy and medical benefits.

“This is the next step in our journey, positioning the combined company to dramatically further empower consumers,” Mark T Bertolini CEO of Aetna, said in a press release. “Together with CVS Health, we will better understand our members’ health goals, guide them through the health care system, and help them achieve their best health.”

The deal is seen by some as a reaction to the threat of Amazon entering the pharmacy distribution space. This merger of CVS and Aetna, if approved by the federal government, is speculated to have wide reaching effects on the insurance industry. Recent reports suggest that other payer/pharmacy deals could be in the works, including a potential deal between Humana and Walmart or Walgreens. 

The CVS deal will also further ingrain CVS Caremark—CVS Health’s pharmacy benefit management  (PBM) unit—into the Aetna customer base. Aetna and CVS Caremark previously signed a 12-year PBM deal in 2010.

—David Costill