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Brainstorm Health: CVS Aetna Merger, Rituxan Biosimilar, World Mental Health Day

Happy hump day, readers! This is Sy.

CVS-Aetna appears to be headed for completion. On Wednesday, federal antitrust regulators gave the mammoth $68 billion health care merger the blessing that it needed, setting up a corporate marriage between a massive insurer, drug benefits manager, and retail pharmacy chain that will likely conclude by the end of the year or the beginning of 2019.

As I’ve mentioned before, the CVS-Aetna deal highlights an evolution in how health care companies are approaching M&A. Rather than spring for horizontal mergers—where companies in the same supply chain space gobble each other up (and may raise regulatory eyebrows in the process)—an increasing number of medical firms are opting for a vertical approach (think: Cigna-Express Scripts).

The thinking goes that such a technique can boost margins for a combined company through supply chain synergies. The added benefit of a more diversified portfolio that may not cause regulators to balk as easily probably doesn’t hurt, either.

That’s not to say that such M&As are 100% easy sailing. The Justice Department’s approval of CVS-Aetna was contingent on a sale of Aetna’s Medicare Part D prescription drug plan business to a subsidiary of WellCare. That sale was announced in late September and is expected to close by the end of the year.

The decision appears to have done the trick. “The divestitures required here allow for the creation of an integrated pharmacy and health benefits company that has the potential to generate benefits by improving the quality and lowering the costs of the health-care services that American consumers can obtain,” said Makan Delrahim, the head of DOJ’s antitrust division, in a statement Wednesday.

Read on for the day’s news.

Sy Mukherjee
@the_sy_guy
sayak.mukherjee@fortune.com

DIGITAL HEALTH

Health care…in spaaaaaace! I can only hope that all of you read that in the intended tone because otherwise you’re probably pretty confused. Regardless, here’s some pretty fascinating news, as reported by MobiHealthNews: NASA has officially enlisted the help of a digital tool called UpToDate in order to support medical decision-making in (what else?) space. As you might imagine, astronauts don’t always have the most reliable Internet connection in the cosmos, which can be a problem if a health problem arises that requires a little outside expertise. The UpToDate tool will provide those aboard the International Space Station said expertise without the need for a continuous connection. (MobiHealthNews)

What if social media could actually reduce depression symptoms? There have been plenty of studies pointing to the potential negative health effects of social media, including anxiety and depression. But what if those very online communities could prove a boon to a certain population set? Researchers writing in the Journals of Gerontology claim that socializing online may reduce the risk of depression in older people who suffer from chronic pain—a group that’s already at higher risk for depression in the first place. (Reuters)

INDICATIONS

FDA panel unanimously backs Celltrion’s Rituxan biosimilar. An expert panel has unanimously recommended that the Food and Drug Administration (FDA) approve South Korean firm Celltrion’s biosimilar copy of Roche’s blockbuster blood cancer medication Rituxan. That adds another major victory for Celltrion, which already has Rituxan copycats approved in some other countries and a generic of Johnson & Johnson’s best-selling anti-inflammatory drug Remicade approved in the U.S.

THE BIG PICTURE

The dire outlook for prisoners on World Mental Health Day. A review by  by Yale law researchers and the Association of State Correctional Administrators (ASCA) finds that more than 4,000 prisoners in the U.S. with serious mental health conditions are being held in solitary confinement, a situation that could exacerbate their underlying health problems. America’s mental health system has been criticized over serious under-funding and a lack of resources which has also transformed jails and prisons into some of the largest de facto mental health care providers in the country. (Fortune)

REQUIRED READING

Microsoft Just Made a Big Move with 60,000 Patentsby Jonathan Vanian

Sears May Be Going Bankruptby Lucas Laursen

Alibaba’s Jack Ma Says U.S. Will ‘Suffer More’ In Its Trade War With Chinaby David Meyer

It’s Time for Employees to Get Paid Leave to Voteby Matt Cartwright & Tom Perez

Produced by Sy Mukherjee
@the_sy_guy
sayak.mukherjee@fortune.com

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