Reuters: Regulatory News: Private suit filed to stop Express Scripts, Medco

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Private suit filed to stop Express Scripts, Medco Mar 29th 2012, 16:38 WASHINGTON, March 29 | Thu Mar 29, 2012 12:38pm EDT WASHINGTON, March 29 (Reuters) - Two pharmacy groups and several small pharmacy chains asked a federal court in Pennsylvania on Thursday to stop Express Scripts Inc $29 billion acquisition of Medco Health Solutions Inc. The merger partners had said on Wednesday they expected the deal could close as early as next week, indicating they believed that Federal Trade Commission approval was likely. The National Association of Chain Drug Stores, the National Community Pharmacists Association, and nine retail pharmacy companies filed a lawsuit on Thursday arguing that the court should stop the merger because it would leave "only two significant competitors in a highly concentrated industry." Pharmacy benefits managers, or PBMs, like Medco handle prescription drug plans for insurance companies and employer clients, and also operate large mail-order pharmacies. The National Association of Chain Drug Stores counts among its members such retail heavyweights as CVS Caremark Corp , Walgreen Co, Wal-Mart Stores, Inc, Target Corp, Supervalu Inc and Rite Aid Corp . The groups argued that if the deal is allowed to go through, it would hurt retail pharmacies, specialty pharmacies which administer expensive and hard to manage drugs for conditions like hemophilia, and large employers who need full service, nationwide pharmacy benefits services. The lawsuit was filed in the U.S. District Court for the Western District of Pennsylvania. Antitrust expert Evan Stewart, from the law firm Zuckerman Spaeder LLP, said private efforts to stop mergers rarely succeed unless antitrust regulators express concern about concentration in the market in question. "If the government agency approves it, the chance that the private plaintiffs will be able to challenge it (successfully) is not high," he said. In separate filings with the U.S. Securities and Exchange Commission on Wednesday, Express Scripts and Medco said they expected that they may be in a position to close the transaction as soon as the week of April 2. The companies also cautioned that there was no assurance the closing conditions would be satisfied or that the proposed deal would be consummated. Link this Share this Digg this Email Reprints

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