Posted by Michael Wonder on 08 Mar 2018
Cigna's $54 billion purchase of Express Scripts could upend the prescription drug market
8 March 2018 - This morning, the health insurer Cigna announced that it plans to buy pharmacy benefit manager Express Scripts for $54 billion.
And with that move – long-telegraphed but seismic – the market for prescription drugs could change dramatically. The big question: will patients benefit, or will this just protect insurance company bottom lines?
What's the big deal? Most insurance plans use an outside firm called a pharmacy benefit manager ("PBM") to decide what drugs to cover, which ones to force patients to pay a big share of, and to negotiate lower pharmaceutical prices. Three pharmacy benefit managers – Express Scripts, CVS Caremark, and OptumRx – control 72% of the U.S. market. A year ago, only one, Optum, was part of a larger insurance company, UnitedHealth. But CVS announced in December that it plans to purchase Aetna, a health insurer, for $69 billion. And now Express Scripts will be swallowed up by Cigna. A year ago, two of the three largest PBMs were not part of a health insurance company. Now, they all will be.
