Job cuts often follow mergers, such as the deal for CVS Health to purchase the insurance company Aetna. But CVS Chief Executive Officer Larry Merlo says this deal may be an exception.
CVS’s Merlo said there’s a reason why the deal with Aetna is what industry people call a vertical integration. Merlo says these two businesses do different things.
“These two companies together, it’s a growth story,” Merlo said. “It’s about expansion. It’s not about contraction. You have two businesses that do not have a tremendous amount of overlap in terms of the services that are provided. With that reality, there won’t be tremendous amounts of job losses.”
CVS runs a chain of retail pharmacies and minute clinics. The company also negotiates drug prices for insurance companies like Aetna. CVS employs 8,000 people in Rhode Island – including about 5,300 at its headquarters in Woonsocket.