CVS Health Corp. and Aetna Inc. may have to wait until at least February 2019 before they can start integrating their businesses in earnest.
Judge Richard Leon, who sits on the U.S. District Court for the District of Columbia, said at a hearing that he will decide whether to approve the merger after the U.S. Department of Justice responds to 95 comments it received on the tie-up between the retail pharmacy chain and the insurer — a process it must complete before being able to ask Leon for his final decision.
If there are delays, the process could wrap up by mid-February 2019 at the earliest, RBC analyst George Hill wrote in a note, but it could drag on into the summer, he added.
The additional review could hold CVS and Aetna from embarking on their integration. The companies have said they plan to realize $750 million in synergies from operating their businesses together.
A spokesman for CVS said: "The actions we've highlighted for the court make a hold-separate order unnecessary." Leon has yet to issue such an order.
Leon first indicated that he might halt the integration between CVS and Aetna earlier in December, when the judge said that the companies only viewed his sign-off as a "rubber stamp," Reuters reported Dec. 3.
The Department of Justice has argued that CVS and Aetna met antitrust requirements after the companies agreed to divest the insurer's Medicare Part D business. The Justice Department stuck with that opinion during the Dec. 18, RBC's Hill wrote, adding that CVS could appeal a ruling from Leon.
"Therefore, regardless of Judge Leon's final ruling, we suspect CVS could have a good chance of success upon appeal, though we grant the timing is uncertain," he wrote.