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Cigna’s Evernorth Business Grows 10% in Second Quarter 2023

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The specialty pharmacy business is a driver of Cigna’s growth, accounting for 40% of the Evernorth’s revenue.

In the second quarter, Cigna’s Evernorth Health Services has achieved revenue of $38.2 billion, up 10% from the second quarter of 2022. This segment includes pharmacy benefits, home delivery pharmacy, and specialty pharmacy, as well as care delivery and management solutions. Cigna, however, would not respond to requests to break out the revenue for the PBM Express Scripts.

For the full year 2023, company executives expect the adjusted earnings of Evernorth will be at least $6.4 billion, with mid single digit growth in the third quarter and mid to high single digit growth in the fourth quarter of this year.

David M. Cordani

David M. Cordani

In an investor call, David M. Cordani, Cigna’s chairman and CEO, said the company’s specialty pharmacy business, Accredo, is a key driver of the company’s growth today and in the future, currently representing 40% of the Evernorth’s revenue. Nearly five years ago, Accredo was about a $30 billion business; today, it is a $60 billion business, he said. In 2023, Accredo served about 900,000 patients.

“We have a competitive advantage in an area of growing need opportunity,” he said. “The breadth of specialty capabilities and the depth of our clinical expertise is a critical driver of positive outcomes and impact we achieve for patients requiring complex and high quality treatments for chronic conditions.”

Cordani indicated that the Accredo is expected to grow in the future. “Although those that use specialty drugs make up 5% of population, they account for 40% of total healthcare costs across medical, behavioral, and pharmacy services,” he said. “This is fueling mid-to-high single-digital annual growth in the specialty market, which is already $380 billion.”

Within the Evernorth division, company executives said they expect additional revenue of $10 billion to $20 billion.

Express Scripts, Cordani said, also prepared for growth as it prepares to begin managing the pharmacy benefits for 20 million members of Centene beginning January 2024. Centene provides healthcare through commercial plans and government-sponsored plans, including Medicaid and Medicare, TRICARE and the Health Insurance Marketplace. Nearly all of Centene’s current estimated $40 billion in drug spending is with current PBM CVS Caremark, Centene officials said last year when the contract with Express Scripts was announced.

Company executives also pointed to a new collaboration with CarepathRx and Evernorth to enhance specialty care. The collaboration will deliver integrated specialty pharmacy care to more than 600 hospitals, health systems and physicians 

In term of trends in the pharmacy space, employers are focused on having healthy, engaged and productive workforce, Cordani said on the call. “They are focused on the complex needs of their population inclusive of, but also beyond, the more intense behavioral conditions, including anxiety, stress, depression and the complexities that go along with that. We are well positioned to meet the needs.”

In addition, the GLP-1 therapies — such as Novo Nordisk’s Ozempic (semaglutide) and Wegovy (semaglutide) — that treat patients with diabetes and obesity are also top of mind for employers, Eric Palmer, president and CEO of Evernorth Health Services, said on the call.

Palmer indicated these therapies are on formulary and the company has value-based arrangements with manufacturers. He pointed to a program called Encircle Rx, which helps plan sponsors reduce costs and enhance outcomes for cardiovascular disease, diabetes and obesity.

“These conditions are often related,” Palmer said. “This program brings together a benefit design, the clinical support that’s necessary and the overall resources to help these patients better manage their disease and plan costs.”

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