An appeals court has denied Anthem Inc.’s (NYSE:ANTM) bid to overturn a court ruling that blocked its planned merger with Cigna Corp. (NYSE:CI) The federal appeals panel in Washington upheld the lower court’s ruling by a 2-1 vote. The Justice Department had sued to stop the $48 billion merger, which would combine two of the biggest health insurers in the U.S.

A lower-court judge agreed to block the deal on the grounds that it risked undermining competition in health-insurance markets. Anthem’s key argument was that the medical savings resulting from the merger were sufficient to offset any anticompetitive concerns. Anthem claimed that the merger would allow the companies to produce $2.4 billion in savings by reducing reimbursements paid to physicians and health care facilities.

The court rejected that argument. The majority questioned Anthem’s claim that the merger would produce Cigna’s superior product at Anthem’s lower rates, stating it hadn’t explained why such savings would occur.

U.S. Circuit Judge Judith Wilson Rogers wrote in her majority opinion on Friday, “One way Anthem maintains the merger will result in this new product is through rebranding. The record, however, refutes rather than substantiates Anthem’s proposed rebranding approach.” U.S. Circuit Judge Patricia Millett, a 2013 selection by President Barack Obama, concurred with Rogers. U.S. Circuit Judge Brett Kavanaugh dissented.

The Cigna takeover was just one of two insurer deals that the Justice Department’s antitrust division blocked earlier this year. The agency also blocked Aetna Inc.’s planned merger with Humana Inc. After losing at trial, Aetna and Humana terminated their deal.

Anthem’s bid to complete the merger is likely over now. The possibility of reviving the deal before the April 30 merger agreement expiration is slim. In an April 26 filing, Anthem said it was seeking a settlement with the Justice Department under the new Trump administration.

The two companies have also sued one another, filing lawsuits in Wilmington in February. Cigna is seeking a $1.85 billion breakup fee guaranteed in the merger agreement. Anthem has sued Cigna for allegedly undermining its legal defense of the deal.

In question is whether either could be faulted for the failure of the transaction. A Delaware judge has blocked Cigna from walking away from the deal pending the results of a May 8 hearing. While Anthem is expected to ask the court to extend the order through the end of litigation, a rejection would set Cigna free to pursue other deals.

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