CVS Health Confirms Split of Pharmacy and Insurance Businesses, Reversing 2018 Aetna Merger
CVS Health announced it will separate its pharmacy business from its insurance operations, undoing the 2018 merger with Aetna that created a $117 billion empire.
U.S. healthcare giant CVS Health confirmed on Tuesday night that it will split its retail pharmacy business from its insurance operations into two separate companies. This decision reverses the 2018 merger that combined insurance behemoth Aetna with the 9,000-store retail pharmacy chain to create a $117 billion empire.
"We believe based off of where we are and how we’re performing, the businesses are best served by splitting," CVS Chief Executive David Joyner told The Wall Street Journal.
The split comes amid increasing regulatory scrutiny and political pressure on the U.S. healthcare industry. Critics had argued that the 2018 merger led to less competition and higher prices for consumers. With Democrats expected to regain control of Congress in January, pressure on large healthcare conglomerates is anticipated to grow further. By splitting, CVS may aim to reduce antitrust risks and allow the two new entities to operate more flexibly in their respective markets.