Express Scripts Settles FTC Charges Over Insulin Pricing
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 4d ago
0mins
Should l Buy CI?
Source: seekingalpha
- Settlement Agreement: Express Scripts has reached a settlement with the FTC, agreeing to implement changes that are expected to save insulin users up to $7 billion in out-of-pocket costs over the next decade, reflecting the company's proactive stance on compliance.
- Antitrust Allegations: The FTC accused Express Scripts of artificially inflating insulin prices through unfair rebating practices, which impaired patients' access to lower-priced products and ultimately shifted the burden of high insulin costs onto vulnerable patients, affecting market fairness.
- Reform Measures: Under the consent order, Express Scripts will cease favoring high wholesale acquisition cost drugs in its standard formularies and will base members' out-of-pocket costs on the drug's net price, aiming to enhance affordability for patients.
- Market Impact: This settlement not only aims to improve drug accessibility for patients but may also prompt other pharmacy benefit managers to reevaluate their pricing strategies, potentially fostering a more equitable competitive environment across the industry.
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Analyst Views on CI
Wall Street analysts forecast CI stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for CI is 335.63 USD with a low forecast of 300.00 USD and a high forecast of 378.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
16 Analyst Rating
14 Buy
2 Hold
0 Sell
Strong Buy
Current: 284.530
Low
300.00
Averages
335.63
High
378.00
Current: 284.530
Low
300.00
Averages
335.63
High
378.00
About CI
The Cigna Group is a global health company. The Company has two growth platforms: Evernorth Health Services and Cigna Healthcare. Evernorth Health Services includes its Pharmacy Benefit Services and Specialty and Care Services operating segments, which provide independent and coordinated health solutions and capabilities to enable the healthcare system to work better and help people live richer, healthier lives. Cigna Healthcare includes the U.S. Healthcare and International Health operating segments, which provide comprehensive medical plan services and coordinated solutions to clients and customers. Its Other Operations include corporate-owned life insurance (COLI), the Company's run-off operations and other non-strategic businesses. Specialty and Care Services provides specialty drugs for the treatment of complex and rare diseases, specialty distribution of pharmaceuticals and medical supplies, and clinical programs to help its clients.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Optimistic Future Outlook: Cigna expects fiscal 2026 revenues of approximately $280 billion, slightly below the consensus of $283.86 billion, but anticipates adjusted income from operations of at least $7.95 billion, demonstrating confidence in future growth despite market challenges.
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See More
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- Customer Relationship Expansion: As of December 31, 2025, total customer relationships increased by 3% to 188.4 million, driven by new sales and ongoing expansion in Pharmacy Benefit Services, showcasing the company's competitive edge in the market.
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- Settlement Agreement Impact: Cigna's settlement with drug management agencies is expected to save American patients up to $7 billion in out-of-pocket insulin costs over the next decade while generating millions in new annual revenue for local pharmacies, significantly enhancing the company's market outlook.
- Earnings Beat Expectations: Cigna reported fourth-quarter 2025 revenue of $72.49 billion, exceeding analyst estimates of $69.83 billion and reflecting a 10% year-over-year increase, primarily driven by strong performance from Evernorth Health Services, indicating sustained growth potential in the healthcare sector.
- Customer Relationship Growth: The company reported a 3% increase in total customer relationships to 188.4 million, reflecting ongoing expansion in Pharmacy Benefit Services and Behavioral Care, although total medical customers decreased by 5% to 18.1 million, highlighting increasing market competition.
- Optimistic Future Outlook: Cigna expects fiscal 2026 revenues of approximately $280 billion, slightly below the consensus of $283.86 billion, but anticipates adjusted income from operations of at least $7.95 billion, demonstrating confidence in future growth despite market challenges.
See More
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- Dividend Increase: Cigna has declared a quarterly dividend of $1.56 per share, representing a 3.3% increase from the previous $1.51, reflecting the company's ongoing commitment to stable cash flow and shareholder returns, which is likely to boost investor confidence.
- Yield Metrics: The forward yield stands at 2.3%, providing relative attractiveness in the current market environment, which may draw in income-seeking investors and enhance the stock's appeal.
- Payment Schedule: The dividend is payable on March 19, with a record date of March 5 and an ex-dividend date also on March 5, ensuring shareholders receive timely returns and strengthening trust between the company and its investors.
- Market Reaction: Despite Cigna's 2026 earnings outlook falling below consensus, the company's performance in improving medical costs has exceeded expectations, indicating that its fundamentals are improving and potentially laying the groundwork for future stock price recovery.
See More
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- Strong Financial Performance: Cigna reported adjusted revenue of $72.5 billion for Q4 2025, reflecting a year-over-year increase of approximately 10%, surpassing market expectations by $3.4 billion, indicating robust growth potential amid improving medical costs.
- Pharmacy Benefit Services Growth: The company's Pharmacy Benefit Services segment generated $36.3 billion in revenue for the quarter, achieving around 20% year-over-year growth, highlighting the significant contribution of its Evernorth Health Services unit and enhancing its competitive position in the market.
- Insurance Business Decline: Despite overall strong performance, Cigna's healthcare insurance unit saw adjusted revenues decline by approximately 16% year-over-year to $11.2 billion, primarily due to the divestiture of its Medicare and related businesses in March 2025, impacting the overall revenue structure.
- Cautious Future Outlook: Cigna estimates adjusted revenue of about $280 billion for 2026, slightly below the consensus of $282.4 billion, with projected Medical Care Ratio expected to range between 83.7% and 84.7%, reflecting the company's cautious stance on future medical costs.
See More
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- Operational Income Increase: The adjusted income from operations for 2025 was $8 billion, or $29.84 per share, compared to $7.7 billion and $27.33 per share in 2024, demonstrating the company's success in cost control and operational efficiency.
- Customer Relationship Expansion: As of December 31, 2025, Cigna Group's total medical customers reached 18.8428 million, an increase from 18.2212 million in 2024, indicating the company's ongoing efforts in market penetration and customer acquisition.
- Optimistic 2026 Outlook: Cigna Group projects approximately $280 billion in adjusted revenues for 2026, with adjusted income from operations expected to be at least $7.95 billion, showcasing the company's confidence in future growth and the effectiveness of its strategic planning.
See More
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- Earnings Beat: Cigna reported a Q4 Non-GAAP EPS of $8.08, surpassing expectations by $0.20, indicating sustained profitability that is likely to positively influence stock performance.
- Significant Revenue Growth: Adjusted revenue reached $72.49 billion, a 10.4% year-over-year increase, exceeding forecasts by $3.41 billion, reflecting strong performance in healthcare and pharmacy benefit services, which boosts market confidence.
- Customer Relationship Expansion: As of December 31, 2025, total customer relationships increased by 3% to 188.4 million, driven by new sales and ongoing expansion in Pharmacy Benefit Services, showcasing the company's competitive edge in the market.
- Optimistic Outlook: Cigna projects 2026 adjusted revenues of approximately $280 billion and adjusted income from operations of at least $7.95 billion, demonstrating confidence in future growth while planning to increase shareholder dividends to $1.56 per share, enhancing investor appeal.
See More
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See More
