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Motion filed against Express Scripts acquisition of Medco


The nation's two largest PBMs have FTC's approval to complete their merger.

The Federal Trade Commission (FTC) approved the $29.1 billion merger of Express Scripts and Medco Health Solutions on Monday, but the retail pharmacy industry continues to fight the deal, vowing to push a request for a temporary restraining order (TRO) that it filed on Friday.

FTC voted 3-to-1 for approval after what it said was an 8-month investigation into whether the merger would “substantially reduce competition for the provision of pharmacy benefit management (PBM) services within the United States.”

A joint statement of opposition to the blockbuster agreement was issued Monday afternoon by National Association of Chain Drug Stores (NACDS) President and CEO Steven C. Anderson, IOM, CAE, and National Community Pharmacists Association (NCPA) CEO B. Douglas Hoey, RPh, MBA.

“NACDS and NCPA will continue to push through the Washington gridlock by advancing the litigation we have filed with 9 community pharmacy companies, and we urge state attorneys general to take action to block the merger as well,” the 2 industry leaders said in the statement.

They also noted that the plaintiffs are filing a motion requesting that the judge direct Express Scripts and Medco to keep separate their assets pending review of the lawsuit and/or schedule an expedited review of the merits of our case.

Commissioner Julie Brill was the dissenting vote, calling the merger an industry "game changer" that creates a "merger to duopoly" between the merged Express Scripts/Medco and CVS Caremark, "with few efficiencies and high entry barriers – something no court has ever approved," according to an FTC news release.

Express Scripts CEO George Paz, in a statement, called the merger “exactly what the country needs now. It represents the next chapter of our mission to lower costs, drive out waste in healthcare and improve patient health.”

Last week the NACDS and the NCPA and 9 pharmacy companies filed a federal suit in Pittsburgh, asking the government to block the merger. Friday, they added the TRO litigation, asking the judge to halt any deal until their suit is settled.

The plaintiffs claimed that the merger would damage both community pharmacists and the public by the reduction of competition.

“This merger has produced a torrent of opposition and concern from community pharmacies and from many others for the simple reason that it is not in the best interests of patients or consumers,” Anderson and Hoey said in their joint statement.

FTC said in its news release that its investigation "revealed a competitive market for PBM services characterized by numerous, vigorous competitors who are expanding and winning business from traditional market leaders. The acquisition of Medco by Express Scripts will likely not change these dynamics.”

Bloomberg News reported that a combined Express-Medco company would handle 34% of prescriptions in the United States this year … but only 29% next year because UnitedHealth Group is switching from Medco to its own PBM unit, OptumRx.

Commissioner Brill called on the FTC to conduct a retrospective study on the merger in 3 years' time.

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