Federal Trade Commission Should Allow CVS Acquisition of Caremark With Conditions, Op-Ed Says

The Federal Trade Commission "should probably not stand in the way" of the $21 billion acquisition of pharmacy benefit manager Caremark Rx by pharmacy chain CVS, Washington Post columnist Steven Pearlstein writes in an opinion piece. According to Pearlstein, the "pharmaceutical industry is in the midst of a major restructuring," and the acquisition is part of a "process of experimentation" that FTC should allow to "play out." However, Pearlstein writes that FTC "ought to get ... promises in writing as a condition for approving this deal" that the combined company will not use "bare-knuckle tactics," such as elimination of competitors from the Caremark network of approved pharmacies. CVS also might seek to use "higher copayments to steer Caremark customers away from other retailers into CVS stores" or use "clever pricing to try to steer some of Caremark's mail-order business back into its retail stores," Pearlstein writes. He adds, "And if any of Caremark's PBM rivals becomes too troublesome, CVS could threaten to drop out of that rival's retail network, knowing that would cause howls of protest in regions where CVS stores predominate." Pearlstein writes, "CVS, of course, swears it has no intention of using" those practices, but FTC should "make sure" (Pearlstein, Washington Post, 11/3).