OMAHA, Neb. (WPRI/AP) – Aetna’s stock has surged after a news report said CVS Health is in talks to buy the insurer in a deal that could be worth more than $66 billion.
The Wall Street Journal reported on the deal talks Thursday. The newspaper cited people familiar with the matter and said CVS might pay more than $200 a share for the nation’s third-largest health insurer.
Spokesmen for both companies declined to comment on the report.
The President of the Economic Development Foundation of Rhode Island Scott Gibbs is a veteran northern Rhode Islander who’s tracked CVS for years. He says if CVS buys Aetna, it would lower prescription prices and increase profitability.
“That could bolster its leverage in negotiations with drug makers, while its oversight of health insurance could improve its ability to strike new deals that tie drug prices to patient outcomes,”Gibbs said. “this is an important strategy move by CVS which hopefully increases CVS’ strength and profitability and that is good for Rhode Island no question about it.”
Aetna’s stock jumped $18.48, or 11 percent, to close Thursday at $180.48.
CVS Health is the nation’s second largest drugstore chain and also processes more than a billion prescriptions annually as a pharmacy benefits manager. Aetna insures more than $22 million people.
CVS Health Corp. is based in Woonsocket, Rhode Island. Aetna Inc. is based in Hartford, Connecticut, however the company is in the process of moving their headquarters to New York City.
Gibbs says the potential purchase is not necessarily to move the company to Woonsocket.
“I don’t think it’s about moving Aetna to Rhode Island,” he said. “I don’t see that happening.”