Patience is not always the best medicine. In the bid battle for Caremark, investors have been holding out in the hope of a knockout offer. So far, neither side has obliged. The latest sweetener from Express Scripts comes in homeopathic doses of $0.00481 a share for each calendar day of delay after April 1.

This makes sense. CVS, the retail pharmacy chain, is hoping to close its agreed merger shortly after a Caremark shareholder vote on March 16. Express had little choice but to increase its offer for its rival, having failed to secure another court-ordered delay of the vote. It can also claim that it has found a neat solution to compensate investors for the latest delays in securing antitrust approval.

At an additional $0.87 a share, assuming a close by the third quarter, Express has done just enough to prompt a similar tweak from CVS. The two latest offers are roughly identical in present value terms. CVS enjoys a slight edge if its cash dividend is counted in full, which remains highly debatable. That might be enough for Caremark shareholders to approve a merger that long appeared to treat the company’s management rather more favourably than its investors. But Express still retains the advantage of a far larger cash component and could raise its offer again.

The real question, however, is whether whoever ultimately wins will live to regret it. Both bids now value Caremark at about 22 times this year’s earnings. Given the risks, not least from regulatory scrutiny as Democrats in Congress start taking a close look at drugs price inflation, this appears rather generous. Add competitive pressures on all parties involved and it is perhaps no wonder that neither side is willing to pay up.

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