The U.S. Justice Department has told health insurer Anthem Inc. that details threatening approval of Anthem's planned acquisition of competitor Cigna Corp. likely cannot be resolved just by having both companies sell off business units, Bloomberg reported.
Representatives from both companies met last week with a Justice Department official, in hopes of protecting their $48 billion merger plan from antitrust concerns, the report said. Justice Department concerns raised at the meeting were initially reported by MLex, Bloomberg said.
Doubts that the deal can be salvaged increase the likelihood that the U.S. will attempt to block it. A government decision is expected in a few weeks, a source told Bloomberg.
Meanwhile, more than 40 advocacy groups have asked the Justice Department to intervene in the proposed Anthem-Cigna deal. The national and state-level organizations made the request Wednesday, arguing that the regulatory process in Connecticut — the state leading the review — has been irreparably compromised by a burgeoning conflict-of-interest controversy engulfing Democratic Gov. Dan Malloy’s administration.
Connecticut Republicans have been demanding that Malloy force state Insurance Commissioner Katharine Wade — a former Cigna lobbyist and a Malloy appointee — to recuse herself from the state’s review of the proposed merger.
Emails obtained by International Business Times show that in February, Wade told ethics officials she had no Cigna business before her, even though her agency was then leading the national multistate review of the company’s merger plan — and even though Wade had repeatedly met with the company’s representatives. The letter from Wade — whose husband is a Cigna attorney and whose father-in-law is a lawyer at Cigna’s lobbying firm — sought approval for her husband to make a Cigna stock transaction amid a proposed merger that would create the country’s largest health insurance company.