Cigna Secures Agreements with Lilly and Novo for Obesity Coverage

Cigna Group has reached agreements with obesity drug manufacturers Eli Lilly & Co. and Novo Nordisk A/S to expand coverage by reducing the amount that employer-sponsored health plans have to pay for these medications.

These agreements, made by the company’s pharmacy benefits manager, are designed to address concerns from employers about rising costs for popular weight-loss treatments like Novo’s Wegovy and Lilly’s Zepbound. Cigna’s program aims to limit annual spending increases on GLP-1 drugs to a maximum of 15%, making it the first of its kind in the market.

This approach could improve access to high-demand medications while providing employers with some financial certainty regarding the cost of GLP-1 treatments.

Cigna’s stock rose by 2.4% in New York and the company is currently hosting an investor conference.

Adam Kautzner, president of Cigna’s Express Scripts pharmacy benefit manager unit, noted the significant demand for weight-loss drugs and the challenges it poses for employers. Some clients have seen spending on these drugs increase by 40% to 50% annually.

Lilly and Novo declined to comment on the specifics of the agreements with Cigna. Express Scripts serves prescription benefits to 120 million people on commercial or government health plans.

GLP-1 drugs are used to treat both diabetes and obesity, with most large health plans covering diabetes medications but hesitating to cover weight-loss drugs. Cigna’s program, called EncircleRx, aims to support patients with diabetes, obesity, and cardiovascular disease, offering services to assist with lifestyle changes.

‘Unique Agreements’

Cigna did not disclose the details of its contracts with the drug manufacturers but described them as unique agreements that allow Express Scripts to offer clients financial guarantees. The list prices of weight-loss drugs range from $1,060 to $1,349 for a four-week supply.

While other insurers have called for price reductions from obesity drug makers, Cigna’s approach focuses on outcomes and adherence levels. The company has raised its long-term average annual adjusted earnings per share growth target and reaffirmed its 2024 guidance.

For more information, you can contact reporter John Tozzi in New York at jtozzi2@bloomberg.net.

To contact the editors responsible for this story, reach out to Jonathan Roeder at jroeder@bloomberg.net.

Contributors: Karen Leigh, John Lauerman

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