The War of the Payers continues. Last we heard from Anthem and Cigna in February, they were filing and counter-filing each other in Delaware Chancery Court–Cigna to end their merger, Anthem to continue. Last Wednesday, Anthem filed an injunction to prevent the deal from expiring as per the merger agreement on 30 April. This injunction may be heard by the Chancery Court on 8 May, according to Anthem documents, but the main court documents are still under seal. (Law 360, via Healthcare Dive 24 April)
To recap the contentious background. The Federal District Court in DC, based on action by the US Department of Justice, first denied the merger on 8 February on antitrust and anti-competitive grounds [TTA 9 Feb]. Unlike the also denied Aetna-Humana merger, it was publicly known, to the point where it was cited in the District Court decision, that the companies had significant disagreements on the merger. After the denial, Anthem wasted no time in appealing for a reversal of the decision with the DC Court of Appeals. Cigna lost no time in wanting no part of any appeal of the ruling by Anthem–and filed in Delaware Chancery Court for $13 bn in damages in addition to the contractual breakup fee of $1.85 bn [TTA 14 Feb]. Two days later, Anthem filed in the same court for an injunction to delay the merger agreement’s legal termination [TTA 16 Feb]. In March, Cigna surprisingly filed a brief in support of Anthem’s appeal (Healthcare Dive), still in progress. Arguments began 24 March, which makes the likelihood of the appeals court decision by the 30 April date doubtful indeed–another reason for the injunction. Anthem has also denied rumors of an appeal to the Justice Department to save the merger (Reuters).
To be brief, as the clock ticks away, there remain rivers of bad blood and accusations of bad faith between these two organizations. Is this merger really necessary? No, it is not, and in our 16 February/21 February update (see analysis), this Editor goes into why Anthem’s persistence in pursuing this is extraordinarily harmful–to their customers and to both companies.