Cigna's Q4 2025 call focused on the resolution of the FTC lawsuit and the passage of PBM reform legislation, framing these as validating its new rebate-free PBM model. Management guided to modest EPS growth of at least $30.25 for 2026, expecting a manageable impact from the GPO move back to the US and investments in the PBM transition. Settled FTC lawsuit; settlement includes $7B in out-of-pocket savings for consumers over 10 years and moving GPO to US, with a maximum 1% tax rate impact if unmitigated.
Cigna's Q4 2025 call focused on the resolution of the FTC lawsuit and the passage of PBM reform legislation, framing these as validating its new rebate-free PBM model. Management guided to modest EPS growth of at least $30.25 for 2026, expecting a manageable impact from the GPO move back to the US and investments in the PBM transition. Settled FTC lawsuit; settlement includes $7B in out-of-pocket savings for consumers over 10 years and moving GPO to US, with a maximum 1% tax rate impact if unmitigated.
Cigna's Q4 2025 call focused on the resolution of the FTC lawsuit and the passage of PBM reform legislation, framing these as validating its new rebate-free PBM model. Management guided to modest EPS growth of at least $30.25 for 2026, expecting a manageable impact from the GPO…
Settled FTC lawsuit; settlement includes $7B in out-of-pocket savings for consumers over 10 years and moving GPO to US, with a maximum 1% tax rate impact if unmitigated.
Reported gross margin was 7.66%, reinforcing the quarter's better-than-guided profitability.
Guidance · revenue to $280B
Management discussed leveraging AI-powered digital tools to personalize customer experiences, including a provider matching tool and a real-time cost-tracking tool. They also mentioned using digital and analytics capabilities to identify patients who need help earlier, and noted increased digital registrations and decreased call volumes.
Management guides to at least 1.4% EPS growth in 2026, maintaining its long-term 10-14% growth algorithm despite PBM model investments and FTC-related transition. The tone is confident and proactive, emphasizing a clear model for navigating regulatory changes.
The company expects to deploy approximately $1.3 billion to capital expenditures in 2026, consistent with prior investments. Capex is not a major focus of the call; the emphasis is on strategic investments in the rebate-free pharmacy model and digital capabilities.
Management expressed confidence in the new pharmacy benefit model, the FTC settlement, and reiterated 2026 guidance, while acknowledging a dynamic environment.
“in aggregate, as David said earlier, we expect to achieve a comparable level of profitability between the legacy model and the new model, although the sources of profit will evolve”
“you can think about an outside impact to the effective tax rate of our organization of up to 1% over time...we see that as totally manageable”
“the Humira penetration in 2025 ended up representing the vast majority of eligible scripts”
“inherent in our new model is what we call our price-assured technology, which guarantees patients the lowest possible price on the drug when they get it filled”
| Metric | Period | Range | Midpoint | Status |
|---|---|---|---|---|
| Capex | FY2026 | $1.3B | $1.3B | GUIDED |
| EPS | FY2026 | $30.25 | $30.25 | GUIDED |
| Free cash flow | FY2026 | $9B | $9B | GUIDED |
| Op marginCIGNA_HEALTHCARE_MCR | FY2026 | 83.7%–84.7% | 84.2% | GUIDED |
| Revenue | FY2026 | $280B | $280B | GUIDED |
Cigna partners with fertility benefits providers Progeny and Carrot, affirming their market traction and role in expanding employer fertility coverage.
“we collaborated with Progeny and Carrot to offer new coverage options for employers to support patients through their fertility journeys”
… in 2025. We expanded our suite of AI-powered digital tools to improve and personalize customer experiences. These include a provider matching tool to help customers find in-network providers based on their specific needs and preferences, and a real-time cost-tracking tool to provide a simple breakdown of costs, both before and after clinician and specialist visits. We also launched new partnerships to expand our offerings. For example, we collaborated with Progeny and Carrot to offer new coverage options for employers to support patients through their fertility journeys. And we announced an industry-first collaboration with Headspace to support the mental health of millions of Cigna healthcare customers with exclusive digital features and content. We see partnerships like these as critical to building a more sustainable model for healthcare and further accelerating innovation for our customers. Our performance across Cigna Healthcare underscores our focus on driving innovation, improving personalization, thoughtfully shaping our product portfolio, and our execution orientation. As we look ahead over a multi-year horizon, We are focused on leading the changes needed in …
Cigna's collaboration with Headspace expands the latter's reach into commercial insurance memberships, reinforcing its B2B2C model.
“we announced an industry-first collaboration with Headspace to support the mental health of millions of Cigna healthcare customers with exclusive digital features and content”
… customers find in-network providers based on their specific needs and preferences, and a real-time cost-tracking tool to provide a simple breakdown of costs, both before and after clinician and specialist visits. We also launched new partnerships to expand our offerings. For example, we collaborated with Progeny and Carrot to offer new coverage options for employers to support patients through their fertility journeys. And we announced an industry-first collaboration with Headspace to support the mental health of millions of Cigna healthcare customers with exclusive digital features and content. We see partnerships like these as critical to building a more sustainable model for healthcare and further accelerating innovation for our customers. Our performance across Cigna Healthcare underscores our focus on driving innovation, improving personalization, thoughtfully shaping our product portfolio, and our execution orientation. As we look ahead over a multi-year horizon, We are focused on leading the changes needed in healthcare to better serve our customers and clients, resulting in improved affordability and access. To do this, we are taking bold actions, including investments …
Evernorth's role as pharmacy partner for EMD Serono's fertility treatment via TrumpRx highlights a direct commercial relationship.
“when the new TrumpRx site launches, Evernorth is the pharmacy partner to the site and will dispense EMD Serrano treatment for fertility”
… Another example is our new clarity solution in Cigna Healthcare that Brian will talk about in a few moments. A second way we are addressing affordability is by informing decisions more clearly on the location where care is provided, as locations can significantly impact patient affordability, whether in a hospital, freestanding facility, or a physician's office. A third way is through meaningful partnerships and collaboration. For example, when the new TrumpRx site launches, Evernorth is the pharmacy partner to the site and will dispense EMD Serrano treatment for fertility. This will make treatments more accessible for all Americans struggling to start or expand their families at the lowest available cash price. And we're helping providers focus on care by minimizing their administrative burden, for example, in prior authorization processes. Over the past year alone, we further reduced the number of prior authorizations by 15%. And going forward, we are partnering with the administration to further streamline the prior authorization process. And a fourth way we are driving affordability is by leveraging competition and encouraging the use of the most cost-effective solutions. …
Cigna highlights Shields as a key investment expanding its specialty pharmacy reach into hospitals, implying growth and strategic value for Shields.
… increase, building on our multi-year track record of sustained earnings growth. We also took steps forward in improving our customer experience, as evidenced by the increase in our customer net promoter score year over year in each of our largest businesses. At the Cigna Group, we also continue to shape our portfolio in 2025, emphasizing businesses where we see clear opportunities to generate attractive, sustainable growth. For example, we further expanded our specialty capabilities to serve hospitals and health systems, in part with our new investment in Shields Health Solutions. And we completed the sale of Cigna Healthcare's Medicare business earlier last year. We are well positioned to continue leading and growing in a rapidly changing environment. To that end, I want to briefly comment on our global settlement with the Federal Trade Commission announced yesterday. The settlement is a comprehensive resolution of all matters brought by the FTC regarding pharmacy benefits business. It includes the industry-wide insulin lawsuit and ongoing investigations. To be clear here, the beneficiary of the settlement are our customers and patients. The settlement noted $7 billion in …
The resolution of the FTC matter removes regulatory overhang for Cigna's PBM operations, creating a clearer operating environment.
… For example, we further expanded our specialty capabilities to serve hospitals and health systems, in part with our new investment in Shields Health Solutions. And we completed the sale of Cigna Healthcare's Medicare business earlier last year. We are well positioned to continue leading and growing in a rapidly changing environment. To that end, I want to briefly comment on our global settlement with the Federal Trade Commission announced yesterday. The settlement is a comprehensive resolution of all matters brought by the FTC regarding pharmacy benefits business. It includes the industry-wide insulin lawsuit and ongoing investigations. To be clear here, the beneficiary of the settlement are our customers and patients. The settlement noted $7 billion in out-of-pocket cost relief over the next 10 years for the 100 million customers and patients we serve. The savings will be delivered through lower insulin prices and reduced costs for brand-name medications for consumers at the pharmacy counter. The settlement will also increase transparency for our customers and clients and strengthen our relationship further with community pharmacists. We were well-positioned to execute on the …
Biosimilar momentum is a major driver. Humira biosimilar penetration is now the vast majority of eligible scripts, with plans for $0 out-of-pocket on Stelara biosimilars. — Confirms the rapid conversion to biosimilars, which will pressure originator brands but provide savings that Cigna can use to offset its own margin pressures.
Great, thanks. I know there's a lot of focus on the PBM, but can you talk about the specialty business? You mentioned some of the strong organic growth there. Can you unpack a little bit some of the key drivers there, what you're anticipating in 2026, any other implications from some of the dynamics at the PBM side as well? but also biosimilar pipeline. And as we head into 2026, how you're thinking about that. Thanks.
Good morning, Eric. It's Brian. So as we mentioned in our prepared comments, really pleased with the momentum of the specialty business, 14% top line growth and attractive earnings contributions alongside of that. And we've talked about before with you, this is already a $400 billion plus addressable market growing at a high single digit secular growth rate, and we're really well positioned to capitalize on that over the longer run. And we certainly saw those dynamics emerge throughout 2025. So the full year, we had 13% growth in prescriptions, higher rate of growth in our Medicare book of business, but also strong growth in the commercial employer and the Medicaid portfolio. And our Evernote business is really well positioned to capitalize on each of those different payer types We continue to expect long-term average annual income growth of 8% to 12% in this business, benefiting from some of these strong secular tailwinds. A few specific TRCs or cost categories I'd highlight that were particularly strong growers include inflammatory, asthma, and allergy. Those generated a good bit of the year-over-year growth in the specialty space. And as it relates to biosimilars, we're really pleased to see the building momentum across the United States, really Humira the past two years becoming mainstream was a great win for the market. And as David said earlier, we expect another $100 billion of specialty drug spend to be subject to competition from biosimilars and generics by 2030. Each of these biosimilars have a slightly different adoption rate based on factors such as interchangeability, dosage levels, branded alternatives, and other dimensions. But we've, as you know, introduced a $0 patient out-of-pocket for both Humira and Stelara. And the Humira penetration in 2025 ended up representing the vast majority of eligible scripts. So that's clearly been a success story for American healthcare from the standpoint of patients getting significant savings, financiers, whether those be employers or health plans, getting the benefit of the savings on these biosimilars. And we look forward to continue driving savings for patients in the future in the biosimilar and specialty generic space. So to kind of wrap this up, this is a space we're really excited about. It's 35% of the company's income now. That percentage will continue to grow in the future as we execute.