The DOJ just approved Cigna's $67 billion merger with Express Scripts

REuters

Cigna CEO David Cordani

• The Department of Justice just cleared Cigna's $67 billion merger with Express Scripts.
• The deal combines a health insurer and a company that helps negotiate lower prices for prescription drugs in the form of rebates on behalf of health plans.
• Cigna and Express Scripts said Monday that they expect the deal to close by the end of 2018.
• Watch Cigna and Express Scripts trade in real time.

The US Department of Justice just cleared Cigna's $67 billion merger with Express Scripts.

Cigna, one of the US's largest health insurers, announced the deal in March, offering $48.75 per share in cash for Express Scripts. The $54 billion price tag was a 31% premium to Express Scripts' stock price at the time, and includes about $15 billion worth of Express Scripts' debt.

The deal combines a health insurer and a company that helps negotiate lower prices for prescription drugs in the form of rebates on behalf of health plans, and is aimed at cutting soaring healthcare costs.

Express Scripts is one of three massive pharmacy benefit managers. When the deal closes, expected by the end of 2018, it will end the days of a standalone PBM.

Read more:The lines around healthcare are being redrawn - and all eyes are on pharmacy giant Walgreens to make the next move

"We are pleased that the Department of Justice has cleared our transaction and that we are another step closer to completing our merger and delivering greater affordability, choice and predictability to our customers and clients as a combined company," Cigna CEO David Cordani said in a release Monday.

The sign-off by the DOJ was the last major hurdle the merger had to get clear, after passing a shareholder vote at the end of August. The companies still need to get the OK from state insurance agencies, of which they've gotten 16 so far, the companies said in a release Monday.

In September, The Wall Street Journal reported the DOJ was close to approving the Cigna-Express Scripts deal as well as CVS Health's $69 billion merger with the insurer Aetna, though that deal might require the divestiture of certain businesses related to Medicare drug coverage before it can go through.