Happy Thursday, readers. This is Sy.
CVS Health on Wednesday detailed what the management team will look like when (and if) its $69 billion mega-deal with health insurer Aetna closes later this year. Several prominent Aetna executives will stay on at the combined company, and Aetna will operate as an independent business unit under the CVS Health umbrella.
Among the most significant announcements: Current Aetna President Karen Lynch will become an executive vice president at CVS while remaining the president of the independent Aetna unit; Shawn Guertin, Aetna’s CFO, will be appointed EVP and CFO of CVS Health; CVS’ Alan Lotvin, a physician, will oversee business transformation iniciatives for the combined company and Aetna’s Rick Jelenik will be appointed an EVP at CVS, co-leading the integration of the firms.
Notable departures include CVS Health CFO David Denton, and Aetna Chief Medical Officer Meg McCarthy, who will leave following a transition period. Another physician, CVS Health’s Troyen Brennan, will stay on as EVP and chief medical officer.
The announcement adds to CVS’ previously unveiled plans to add Aetna CEO Mark Bertolini to CVS’ board of directors, and that CVS Health chief executive Larry Merlo will remain chairman and CEO of the combined company.
CVS’ decision to retain two of its leading physician executives, Brennan and Lotvin, is a clear strategic move designed to help the combined company integrate the various medical benefits and health care services delivered by CVS and Aetna, which also involves interacting with players such as federal government programs and employers.
The CVS Aetna deal is expected to close in the second half of 2018 if it passes regulatory muster.
Read on for the day’s news.
Have you heard the one about the glucose sensor and the koala? Glucose sensors have been a life-changing medical advance for millions of Americans with diabetes. But did you know they can help out koalas—koalas!—too? Renowned physician Dr. Eric Topol tweeted out about a collaboration between Scripps Translational Science Institute and the San Diego Zoo to monitor the blood sugar of uncontrolled diabetic koala Quincy—Quincy!—using a glucose sensor embedded beneath a tube top worn by the bear. And yes, there is a picture.
Pfizer’s drug shortages, in charts. My colleague Grace Donnelly has compiled some illustrative charts tracking drug giant Pfizer’s injectable drug supply chain problems (most recently, this manifested itself in a voluntarily nationwide recall of the opioid overdose antidote naloxone manufactured by Pfizer’s Hospira unit). But as Grace points out, this troubling issue isn’t just limited to Pfizer—drug shortages are regularly a problem for other pharmaceutical manufacturers, too. (Fortune)
Icahn reportedly building small stake in Allergan. Bloomberg reports, citing inside sources, that activist investor Carl Icahn is building a small stake in Botox maker Allergan, a company with which he has a long-standing relationship. The reported stake follows an increasingly aggressive turn by David Tepper’s Appaloosa Management, which has sharply criticized Allergan’s strategic decision making. (Bloomberg)
Axovant stock shoots up on gene therapy deal. Shares of drug maker Axovant have been on a tear this week following news that the company has struck a $842.5 million licensing deal with Oxford BioMedica for its experimental gene therapy treatment for Parkinson’s disease (only $30 million of that is upfront cash rather than milestone payments). The company faced a huge setback late last year after its experimental Alzheimer’s treatment crashed and burned in the clinic, prompting the exit of former CEO David Hung (who used to be the chief executive over at Medivation, now owned by Pfizer). Axovant stock is up 240% in the past five days and 11% on the year.
THE BIG PICTURE
Google salutes Dr. Virginia Apgar. Today’s Google Doodle pays tribute to Dr. Virginia Apgar, who would have been 109 years old today. Apgar was an obstetric anesthetist who created the Apgar Score, a test for newborn babies that’s still used to this day (the test examines things such as the baby’s appearance, pulse, activity, and respiration). (Fortune)
U.S. suicide rate spikes sharply since 1999. A troubling new CDC report finds that suicide rates in the U.S. shot up 25% across the nation between 1999 and 2016. “These findings are disturbing. Suicide is one of the top 10 causes of death in the US right now, and it’s one of three causes that is actually increasing recently, so we do consider it a public health problem—and something that is all around us,” said CDC principal deputy director Dr. Anne Schuchat in a statement, noting that more than half of the suicide victims hadn’t been diagnosed with a mental health condition. (CNN)
How Jonathan Bush Lost to Elliott Management, by Jen Wieczner
|Produced by Sy Mukherjee|