Cigna's Positive Second Quarter Numbers Reflect Shift to Pharmaceutical Services

Cigna remains one of the nation’s largest health insurers, but its shift toward becoming a pharmaceutical services company was evident today as it reported relatively rosy second-quarter earnings results and projections for its financial performance for the rest of the year.

During an earnings call this morning, Ann Dennison, executive vice president and the company’s chief financial officer, said that more than 60% of the company’s enterprise earnings come from Evernorth Health Services, the part of the company that includes Express Scripts, its pharmacy benefit manager; Accredo, its specialty pharmacy; and CuraScript SD, its specialty pharmacy distribution business. Brian Evanko, the president and chief operating officer, noted the company had “no exposure” as a health insurer in the Medicare and Medicaid programs and that the number of people covered by its Affordable Care Act exchange plans has decreased from approximately 1 million in 2023 to 400,000, the result, he said, of prioritizing margin over growth.

David Cordani

David Cordani, the chairman and CEO, commented that a decade or so ago, the cost of aggregate pharmacy services accounted for a low double-digit portion of the “total medical cost equation.” Now, he said, they account for a mid-20% portion and could grow to 30%. “It is a more significant part of the overall care equation.” Evanko said CuraScript SD’s revenues have grown at a double-digit rate over the past three years and that it is now a $25 billion business for Cigna.

The second earnings report paints a positive picture for Cigna, with overall revenues increasing to $67.2 billion, an 11% increase from the $60.5 billion during the second quarter of 2024, and adjusted income from operations for the second quarter coming out to $7.20 per share, an increase from $6.72 per share for the second quarter of 2024. Dennison said the company was reaffirming its full-year projection of adjusted income from operations to be $26.90 per share, with Evernorth’s full-year pretax adjusted earnings expected to be at least $7.2 billion and Cigna Healthcare’s to be $4.125 billion. The company's insurance business had a medical care ratio of 83.2% in the second quarter and today's earnings statement projects that will be between 83.2% and 84.2% for the year. The medical care ratio, also known as the medical loss ratio, is the proportion of premium dollars spent on paying healthcare claims. Health insurers have been grappling with rising medical care ratios as the price and intensity of medical services used by their members have increased. Cigna reported today that its second-quarter medical care ratio had increased from 82.3% in the second quarter of 2024 primarily due to higher medical costs in its stop-loss business.

Cigna’s shift toward pharmaceutical services has been apparent. In March 2025, it closed a deal to sell its Medicare Advantage and other Medicare-related businesses to Health Care Service Corporation, the company of five Blue Cross and Blue Shield plans, for $3.3 billion.

Pretax adjusted income from operations in the second quarter of this year was greater from Evernorth than it was for Cigna Healthcare ($1.7 billion vs. $1.1 billion). The Evernorth income from operations in the second quarter was close to evenly split between its pharmacy benefit services business and its specialty pharmacy and care services ($833 million vs. $863 million).

In addition to calling out the growth of the CuraScript SD, Evanko said the company’s pharmacy benefit management business, Express Scripts, had strong client retention, and he mentioned the recent multiyear contract extension with Prime Therapeutics. Evanko also touted a program that sets a $200-per-month out-of-pocket cost on glucagon-like peptide 1 (GLP-1) drugs for weight loss.