Cigna’s stock dipped 2.9 percent Feb. 1 after the health insurer reported its fourth quarter earnings and HHS proposed a new rule aimed at lowering prescription drug prices, according to Barron’s.
The health insurer’s quarterly profit was better than expected; however, Cigna’s revenue and earnings forecast was below Wall Street estimates for its first full year running Express Scripts, according to Reuters.
Cigna also faced headwinds from HHS’ new rule, under which drug manufacturers would no longer be able to give rebates to pharmacy benefit managers, but they would be allowed to offer discounted prices directly to consumers. While Cigna CEO David Cordani said during the health insurer’s fourth quarter earnings call that HHS’ “proposed rebate rule won’t have a meaningful impact on our growth or earnings trajectory,” Barron’s said the rule could chip away profits for Cigna.
“Whatever the outcome of this latest HHS proposal, the risk of federal interference in drug pricing will be with Cigna investors for the foreseeable future,” according to Barron’s.
Date: Feb 06, 2019