Antitrust enforcers signed off on Cigna Corp.’s $54 billion takeover of pharmacy-benefit manager Express Scripts Holding Co., clearing one of two health care deals that stand to reshape the industry.
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. While some state regulators have yet to sign off, the U.S. review was one of the last major steps for the agreement the companies struck in March.
Express Scripts shares rose 3.7% to $95.23 at the close in New York. Cigna was up 1.4% to $197.84.
Insurers, pharmacy-benefit managers and others in the health care supply chain have been making deals to streamline expenses and gain scale in an industry threatened by rising costs for medical services and new competition from the technology sector.
The Justice Department said it cleared the deal following a six-month investigation. The deal won’t significantly reduce competition in the market for the services provided by pharmacy-benefits managers or raise costs for Cigna’s rivals, the department said in a statement.
Cigna’s deal for Express Scripts came on the heels of CVS Health Corp.’s about $68 billion deal to buy insurer Aetna Inc., which is still under review. That combination would unite the U.S. drugstore giant with the third-biggest health insurer. CVS also manages drug-benefits plans for employers and insurers, a business that could help steer Aetna’s customers into CVS drugstores when they fill a prescription.