Main Menu

Our Work

DOJ approves Cigna-Express Scripts merger

After a six-month review, the Department of Justice (DOJ) cleared the $67 billion merger between Cigna, one of the country’s largest health insurers, and Express Scripts Holding Company (ESI), a major pharmacy benefit manager (PBM).

Bates White was retained to work on the matter on behalf of Express Scripts. Partner George Rozanski and an outside expert worked with the parties to analyze possible concerns related to horizontal effects of the proposed transaction in markets for PBM services and Medicare Part D insurance. An additional focus was on vertical merger concerns, relating to possible effects on ESI’s incentives to provide PBM services to Cigna’s health insurance rivals. Bates White’s analysis of possible vertical effects included a vertical merger simulation calibrated to market outcomes, which quantified effects on incentives and prices. Bates White also undertook a retrospective analysis of the effects of previous vertical integration in the industry. The expert's work was focused on identifying and quantifying efficiencies of vertical integration.

Bates White worked closely with the parties to identify possible concerns and to respond to requests for information from DOJ and various state regulatory agencies. Bates White also presented its analysis to DOJ. In clearing the merger, federal officials noted that it was unlikely to lessen competition in the PBM business or to allow Cigna to increase costs of its rivals. The parties completed their merger in December 2018.

Jump to Page