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Cigna buys 23% of the pharmacy benefit market in landmark deal

On March 18, 2018, the New York Times reported health insurance giant Cigna agreed to buy Express Scripts, then the nation's largest pharmacy benefit manager, for $52 billion. Find out who is really benefiting from PBMs.

In early 2018, it was announced that Cigna, one of the top five health insurance companies, had purchased Express Scripts, the last major independent pharmacy benefit manager, for $52 billion. The merger came on the heels of several that had failed, including Cigna/Anthem and Aetna/Humana, but Cigna was able to make the case that this deal was different. The company claimed that integrating the delivery of care and pharmacy benefits under its umbrella would actually help control rising medical costs. Not everyone agreed. George Slover, senior policy counsel for Consumers Union, stated that the merger, and others like it, could result in restricted choices throughout the healthcare marketplace, ultimately leading to higher costs and potentially lower quality coverage and care for consumers. In addition, the commissioner of the Food and Drug Administration, Dr. Scott Gottlieb, said that the situation had created “misaligned incentives,” as the discounts that manufacturers negotiate “may not always be passed along to employers or consumers.” A few years post-merger, there is plenty of evidence that the acquisition of Express Scripts has driven massive profits for Cigna, but it’s a bit harder to find evidence of decreased costs or added value for those that Cigna insures.

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