LEE: Merger of Pharmacy Benefit Managers a Significant Transaction That Could Benefit Consumers

February 23, 2012

WASHINGTON – Today, Senator Mike Lee sent a letter to the Federal Trade Commission regarding the proposed merger between Express Scripts, Inc. and Medco Health Solutions, Inc.  Lee, the Ranking Member on the Senate Judiciary Committee’s Antitrust Subcommittee, noted that the merger of these two large pharmacy benefit managers (“PBMs”) is a significant transaction that should be given careful consideration by the FTC.  Lee’s letter urged the FTC to pay close attention to the pro-competitive effects that may result from the merger.

“The merger of these PBMs may pose some risks to the market’s competitive balance but overall has the potential to create meaningful efficiencies and provide significant savings for consumers.” 

“The combined entity may produce significant cost savings for health plan sponsors by means of its increased bargaining power and its improved tools for closing gaps in care, promoting adherence to medications, and overall disease management.”

“I am not aware of significant evidence that this merger will result in decreased competition among viable PBMs able to service most companies and accounts.”

Lee stated that any anticompetitive effects of the merger on community pharmacies would be of special concern, “in light of the important service those small businesses provide to rural and otherwise underserved residents in my State and throughout the country.”   

Lee’s letter added that it is important to remember that the purpose of the antitrust laws is to maximize consumer welfare, not to protect competitors, and that “government regulators must be careful not to intervene in a manner that will constrain productive market forces.”