Why the FTC is watching CVS, Amazon's healthcare deals

The FTC is closely watching healthcare deals such as CVS' planned acquisition of Signify Health and Amazon's planned acquisition of One Medical, which could potentially delay the deals from closing, Barrons reported Feb. 16. 

These deals are undergoing deep scrutiny from the FTC as investors have been increasingly cracking down on Big Tech mergers. 

For example, on Sept. 2, 1Life Healthcare, which operates One Medical's primary care clinics in 25 U.S. markets, said that One Medical and Amazon had received a request for more information about the planned $3.9 billion deal from the FTC.

The investigation, according to The Wall Street Journal, could delay the acquisition's completion as U.S. antitrust probes, on average, take about 11 months. 

The FTC has also been allegedly prepping an antitrust case against the deal. 

Bloomberg reported that the FTC was hiring outside economists to review the pending deal and said it may sue Amazon over alleged anticompetitive practices. 

An Amazon spokesperson told Barrons that it continues to "work cooperatively with the FTC in their reviews of this transaction."

Amazon isn't the only one. 

CVS is also facing FTC scrutiny for its planned acquisition of home health company Signify Health

According to the report, the Department of Justice sent both companies a second request for information on the merger on Oct. 19. 

"CVS Health and Signify Health have been working cooperatively with the DOJ and will continue to do so," said CVS in a filing with the Securities and Exchange Commission. 

According to the report, CVS said it planned to close the transaction in the first half of 2023, but now CVS doesn't expect it to close until the second quarter of the year.

CVS hasn't received any FTC requests regarding its Oak Street acquisition, but John Ransom, economic analyst, said the landscape of the FTC may prove to challenge this acquisition as well.

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