The Cigna Group (CI) Earnings Call Transcript & Summary

Okay. Good morning, everyone. Welcome to the Cigna session. I'm Bob Jones. I'm joined by my colleague, Kevin Hartman. We cover health care services here at Goldman. Joining us from Cigna, very excited to have Tim Wentworth, CEO of Evernorth; as well as Alexis Jones from Investor Relations. So welcome to you both, really appreciate you guys both being here today.

Thanks. Great to be here. Good to see you, Bob.

Good to see you, too, Tim. So the format, obviously, keeping this conversational as possible to the extent that folks in the audience have questions, you can e-mail them to me. But before we dive into the Q&A, Tim, I was going to turn it over to you to see if maybe you had a few opening remarks you wanted to make.

Yes. I'll be brief because I know there are a lot of questions and a few events even in the last week that you probably were going to want to talk about. So here's what I'd say. I appreciate everybody tuning in today. I appreciate the chance to sort of reinforce the story that Evernorth and Cigna really represent in the marketplace, which is a super capital-light, very focused services company that has hit the marks in terms of what we committed to do in the first couple of years plus of our merger. But more importantly, I think we declared pretty clearly at our recent Investor Day the fact that we're going to create $50 billion of free cash flow over the next 5 years; the fact we're going to deploy that incredibly responsibly while, at the same time, dealing with the issues that are the most important and pressing issues in health care right now; and then specifically around things like pharmacological innovation, around the tie-in between mental and behavioral health and whole person health side of care. And you've seen us make moves in all those places that are really, really -- should give you a clear picture of where we are heading and why we're excited about our business long term. And so I love the chance to talk about our business today. I think, again, a lot of the dynamics that we'll be talking about are things that we built this company to solve or to work with. And I couldn't be more excited to do that with you, Bob. So fire away.

Great. Great. Thanks for that, Tim. Yes. I mean maybe just to start off with something pretty topical because we continue to get this question for obvious reasons. If we think about the pandemic and all the disruption it caused across health care and across Cigna's enterprise, obviously, as well, from a script perspective, thinking about Evernorth's view of this, how would you characterize where we are today as far as the recovery back to prepandemic levels within script volumes? And if there is areas where we're maybe not all the way back, what are they? And what's your thoughts on getting those areas kind of back up to where they were before this all started?

Yes. I appreciate the question. And what I would say, I can only speak for our book of business, which is quite large, as you know, I would tell you that script volumes are very much back to prepandemic levels, and they really didn't dip a lot during the pandemic. If you looked at the scripts that are the most important to us, which are the ongoing maintenance drugs that patients are taking, particularly patients who needed to stay on those drugs through the pandemic in the event that they were to contract COVID would have been a more serious risk than noncomorbidity patients or morbidity patients. And so from that standpoint, we didn't see the big drop off. We clearly see on a go-forward basis, though, that prescriptions are strong. We see, again, some preference from mail service carrying through past the pandemic. So folks that pick up mail have continued to use mail and like it. So we got a little bit of a channel shift there, not major, but it was meaningful. And in terms of areas that we would be focused on or looking at, I guess the big one that we don't directly manage is vaccines. We'd love to continue to see more vaccine volumes than we do because, again, we've got patients who are fairly fragile, in some cases. And what I would tell you is we've worked with our messaging to those patients specifically to be sure they understand the importance of being vaccinated, but more importantly or as importantly, the importance of staying on their meds. So really not a major down headwind last year, not a major tailwind relatively this year. Instead, we did our job both years.

Got it. Got it. One other one I wanted to touch on really quickly that's very kind of top of mind in the current market was around generic pricing. It seems to be a bit of a debate that's bubbled up in the last quarter or so around are there pockets of generic drugs that are seeing greater deflation than normal or not or is it stable? Just given your perspective from Evernorth both from somebody who obviously pays the claims, but also has a large purchasing presence as well, I wanted to see what your views were kind of real time on what you're seeing with generic pricing.

Yes. We're seeing it largely in line with kind of what we've expected, which is there are pockets of deflation, nothing that I would point to being noteworthy. And I think the good news is that deflation and more broadly, our experience in working with the generic manufacturers indicates a highly competitive market still, which is really good because I think there was some concern over the last few years about would there be concentration in that market in a way that created some price adversity for us and for, frankly, the payers. And you don't see that. And you have the evidence of that. Take a look at the company who's launching $1 generics now and so forth. I mean, clearly, there's been -- there's plenty of demand, there's a lot of competition in the place. There are certainly still drugs that don't have competitors, right? There are generic drugs that's sort of -- and some of them are fairly old, they don't have competitors. And we continue to look to drive those prices down and, in fact, have, in some cases, encouraged manufacturers to step in or even support a second manufacturer stepping in. So again, there are some subdynamics that we continue to work. But on a macro basis, very much in line with expectations, very much payer-friendly in terms of the generic pricing paradigm that we see.

Great. Yes. I guess maybe just to take a step back and think about Evernorth's performance in general as of late and, quite frankly, PBM's performance in general, it's been very strong. I think it certainly has been exceeding expectations. Just this past quarter, Evernorth saw EBIT growth of around 13%. Can you just help walk through what some of these drivers have been? I mean I think you and I have been around the PBM industry for a long time. I mean it certainly feels like we're in an outsized window of growth. And I think a lot myself and a lot of folks just have a hard time unpacking what the real drivers underneath this are and how sustainable they can be.

That's a great question. Thanks. So first of all, I mean I'm the only guy probably on here that's not surprised because, quite frankly, I love the business. The need has never been greater for what we do. It's why they can't get rid of me at this place because I love what we're doing. And -- but the real fundamental fun part of the business is your levers continue to evolve and change. And so the things that have made us successful, some of the dynamics are the same. So for example, you'll get the generic wave that you and I lived through over a 20-year period, we've largely captured that value. We're at almost 90% generic prescriptions now, but we look forward at specialty generics and biologics as a huge forward-looking opportunity to take some of those same levers, use a much more clinically intensive model because you tend to have to do there. But those things are already starting to happen. So specialty generics have been very valuable. And if you then zoom back out to specialty drugs broadly solving what is the #1 concern for most of our payers through the #1 asset in the class, that being Accredo, and the benefits management that we bring alongside of Accredo has fueled a significant amount of the growth this year that you've seen. And so I remember and I'm old enough to remember when specialty drugs weren't even a contracted separate class of drugs in a PBM contract. Today, it's the most important thing that we're doing, I would argue, amongst several things that are terribly important. Supply chain. When -- I hate to sound like a historian here. When we took BECO public in '02, '03, the concern was that rebates would go away. Here we are 20 years later and everyone's still wringing their hands about rebates going away even as we produce amazing amounts of net cost value by leveraging the PBM. And so again, our results over these last several years, including the first quarter, were indicative of a continued expansion of opportunity, bringing ourselves to the table and collaborating with pharma companies to create value for the end user and create value for our GPO participants in Ascent. And so you look at those 2 areas and again, they look like plain old vanilla PBM, one level; but another level, you realize they are highly evolved mechanisms to create value. And that's what we continue to see grow. The third piece is, organically, we've grown scripts and we've grown relationships. And so the deepening of relationships is really important to us. Eric Palmer, our President, and I were recently with one of the largest health plans in the country, a single blue plan, one of the largest, meeting with their top folks for an entire day. And the conversation was in part fueled by the fact that they are growing because we're helping them grow. And that's our job. And so we can grow by virtue of winning new labels, but we also grow by helping the marketplace grow. And so in the quarter, you really saw the sum effect of all of those things certainly lapping and expanding on our Prime relationship specifically produced incremental value in the quarter both in terms of bringing on specialty lives, but also now it's a full -- we're entering the first full, full year of some of the things that we've done for them. And so again, producing more value for Prime and having a small piece of it stick to our ribs was a contributor. So really good quarter where really all the things that we're paid to do on the PBM side delivered. I would then more broadly zoom out and remind you, eviCore has had a really good year this year. And so the need for what they do and their product set, which has been expanding, has continued to be very, very well accepted and important. And so again, across those pieces, even as we build out new things that don't have quite the heft yet to make a difference in the numbers, we're performing really well.

No. That makes a ton of sense. Appreciate that context, Tim. Yes. You mentioned specialty probably now being the most important thing, top of the list for your clients. Any sense you can give us on just how big specialty is within Evernorth? This is a question we get quite a bit. And obviously, the companies consistently -- you and your peers consistently point to, this is probably the most important thing to your clients, probably the biggest driver of growth. And yet we have a hard time on our side of the world and the investment side of the world really understanding the size and scope of it at this point.

Sure. And I understand that, and we don't purposely make that difficult for you, but I recognize that it's also really important to understand that specialty -- there are couple of dimensions I'll give you. It's for most of our clients now half or more of their spend. So if you just look at pure drug spend, it has crossed that, what, kind of being heft of the spend. That's number one. Number two. For Evernorth, it's about -- we've said that it's about 1/3. In fact, Alexis, keep me honest here, maybe slightly over 1/3 of our revenue, okay? And what I would tell you is it's probably more than 1/3 of our profitability, but we haven't given that number. And to some extent, the profitability in specialty is a direct function of what your mix of drugs is and how much services you're providing to a patient. And so high-volume drugs that are relatively easy to stay stable on for a patient are going to be less interesting from a profitability standpoint, although very important because they support the overall capital structure of the company than some of the rare diseases that we take care of where we've got nurses going to people's homes on a weekly basis, that develop relationships with these patients, that help keep these patients on the drug, healthy and so forth. And so as we look at the value creation on specialty, that's a piece. What I would point to, though, because I hate sort of talking about it being 1/3 of our revenue because my hope is to drop to 20% of our revenue by virtue of adding a whole bunch of biosimilars, which would be revenue depressing but be massively value creating both for the system and for us as the chassis through which that drug could find its patients. And so again, the static view of what it is would almost be meaningless as we -- if we look out over the next 5 years because where value is really going to be created isn't only in potentially being able to negotiate and handle drugs. Even like the drug that came out this week, that will be on the medical side to start with, but we're well equipped to potentially play a role in, particularly if we could get sort of Part B to look at PBMs seriously and what we could do, but also, the biosimilar wave over the next 5 to 10 years and the opportunity to unlock that, which is now becoming tangible and real. It's -- in 2019 to '20, it was very frustrating. But as we're entering '21 and looking at '22, we can see '23 coming in the very high likelihood of producing some real value on biosimilars. And I think that will be a tipping point because the biosimilars that have come out so far have largely been on the medical side. They've been priced in such a way as to not be amazingly attractive relative to moving patients and the investment in clinical that you would do to do that. We think over the next 10 years, that's going to be meaningfully valuable. And so again, the metrics even that would cause you to get excited about specialty will be different. And I think ultimately, the place to look for us is going to be how many patients are we touching. And I know we don't completely give that number today. We are challenging ourselves to say, "How else can we help you understand kind of our footprint and the opportunity in that footprint?" That really comes down to how big is your patient base and what's the mix of those drugs that today you're handling. But the thing you should look at is the chassis that we built, which we've used repeatedly to create value is going to be more needed than ever in the next 5 to 10 years.

Yes. No. I think that's pretty clear. You mentioned the drug that was approved this week, big news in the Alzheimer community. So maybe we'll go there next. Obviously, if they win at Biogen, big progression win for folks with Alzheimer's. A lot of questions, obviously, at this point given that it was just approved. But wondering how is Cigna and Evernorth viewing this even kind of from a knee-jerk perspective? You mentioned being able to try to help manage and control costs. Like what are the types of things you think about or that immediately spring to mind when you see something like this come to market that obviously is going to come to market with, maybe rightfully so, fairly healthy price tag?

Yes. So first of all, our knee-jerk reaction is always the same, which is how can we get access to the patients who will benefit from the drug, access at an affordability level that both they and the system can afford, right? That's our first knee-jerk reaction. In this case, as you would have seen in the announcement, we're in conversations. I will actually say that I met with -- I had a conversation with Biogen's Board a number of years ago about pricing. And I know that Biogen has been interested in understanding how to create access and affordability. Now their list price is not where this conversation should end because it's -- we think there's a lot of opportunity to create meaningful value in excess below that number, and we're in the process of working with them to understand sort of how we can best do that. You've seen us in other categories do value-based contracting that went beyond just get the list price low. And I think this is a case where we can help both the payer and the originator, in this case, Biogen, by ensuring that the right patients are getting this drug and that the wrong patients aren't because that narrative isn't good for anybody and it's also -- it just takes resources out of the system and creates waste. That over time, we can track how the patients are doing on this drug potentially were chassis for that. And I believe that one could envision that Biogen will be asked questions in the future about how this drug is working in market, and we are in a position to potentially help them with some of that data as our others that do what we do. In terms of -- I'd like to believe that they're willing to stand behind this drug. That if it's given to the patient for whom it's indicated, that if it doesn't work that there'd be a mechanism to potentially get a payer back some or all of their investments in trying this drug with that patient. Now there's a whole bunch of hurdles that one would have to envision as it relates to how do you ascertain whether it's working or not, how do you get a high fidelity of that. But we have shown in other categories that we can obtain -- because the pharma companies wanted to stand behind their product, we can actually create the mechanism to ensure that where the patient is not succeeding that, in fact, are getting -- that they're then standing behind it. The flip side of that is, what the pharma company wants to know is, we are going to do everything possible to ensure that the patient who is appropriate for the drug stays on the drug, works through side effects, is counseled appropriately from a pharmaceutical standpoint, their physician has a place they can go to for questions so that, in fact, we raise the odds materially of a patient who should be on the drug actually succeeding. And so all of those are things in our playbook. You would have seen us pull that playbook out for hepatitis C. You would have seen us pull that playbook out for two of the new genetic drugs, the gene therapies that came out, and we were able to leverage a number of mechanisms. And so again, we come to the table not with a one-size-fits-all solution, but with a set of principles and a playbook that says, "We want to take the unique aspects of this particular product and this manufacturer's goals and the goals that we would have for patients." Now in the end, Bob, it's going to be largely a government paid product. We're going to wait to hear how CMS feels about coverage determinations, to see sort of how material is it to the Med Advantage players in the marketplace. But from our standpoint, we think it's a natural place for a PBM to be moving, and I hope it becomes a poster child for CMS to look at and to realize that perhaps PBMs on Part B can bring some of those same principles to bear and help drive affordability and access.

Yes. No. It will be very interesting to see how this progresses and plays out. All that makes sense. Yes. I guess maybe one another question that comes up. Obviously, you've lived through a number of selling seasons in your career. I think the cadence of RFPs potentially last year versus this year, there's a view that, clearly, last year, a lot of things were maybe punted or put on hold or suppressed just given all that was going on and benefit managers being focused rightfully so in other areas. How are you seeing this selling season shape up? And is the view that this is going to be an outsized year of movement? Is that something that you would subscribe to and that you're seeing?

I'm not sure it will be. It's a modestly more robust year of sort of activity, but not -- all of us that compete -- and I'm not talking specifically the PBM space, obviously. All of us that compete have gotten very good at taking the relationships that we've done a good job of in attempting to secure to protect them. And -- but all of us also tolerate a loss or 2 now and then. We had a couple of health plan losses, for example, that are not systematic of -- or systematically indicative of anything. They're also not things that were being stalled because of COVID. I think that what we're seeing on the employer side is actually very high retention and some really interesting opportunities in the market. So I think employers may be particularly interested in just double checking that their alternatives are -- they've made the best set of choices given kind of a reevaluation of how important benefits are in this very tight labor market. And therefore, making sure that also as they put additional point solutions in to try to drive affordability because they're not going to be able to reduce benefits in this market, therefore, they're going to -- they're looking for other things to drive affordability, looking for partners that can actually integrate with those things really effectively and play nice, so to speak, with others or even better yet, play an integral role in part of all of what's being done. And so we're really well positioned we think in the employer space to keep our clients with fairly high retention rates as well as to potentially win some additional. Again, in the health plan space, we like our book of business a lot. We like the market -- the opportunities that are out there. Again, even the 2 plans, and this is again a reconceptualization of what we do that I don't think the market's caught up with yet. Even the 2 plans who have decided from a PBM standpoint to go another direction actually remain very robust clients for Accredo and Evernorth -- or sorry, Accredo and eviCore as well as very interested in some of the other things that we'll be doing down the road with behavioral health, some of our advanced analytics. Now we've got to go back and earn our way in. And ultimately, I want to be their PBM again. But for us, it's not this bipolar end point or a selling season that's all and only about the PBM. We actually -- eviCore is having a terrific season in the market, for example. Accredo is growing tremendously. And so as I look at our overall go-to-market piece from an Evernorth standpoint -- and by the way, Cigna itself is -- from an enterprise had very good results both in their government business, the select business and the individual business. We're kind of humming on most of our cylinders in terms of organically showing up in the marketplace. And I expect that should continue.

Tim, Alexis, thanks for doing this, and I appreciate all the detail so far. So I know you touched on some of the regulations. Obviously, that's not a new thing in this industry. The PCMA case versus Rutledge I think has come up a lot. And I think we've seen some states doing a little bit of new things, I guess, on the PBM side just in the wake of that ruling. And so just curious if you got -- what you guys have been seeing broadly, if it's anything new and just how you see the model potentially evolving as a result of some of these things that have been coming out.

Yes. Thanks. I mean it's obviously -- first of all, through PCMA as well as an individual company, we engage -- in the states are a very robust sort of area of activity right now, as you rightly point out. We've actually had a pretty good year in terms of what a legislator puts forward versus what actually gets turned into a bill versus what actually gets voted on versus what the governor ultimately signs. We've seen the opportunity across the piece that educate players about the value we create and about the patient focus that we bring. And as we say, a PCMA, the care, the C in PCMA, bringing that to the front of the conversation, and we've been pretty successful. That said, you do see state legislatures, in particular, somewhat prone to being somewhat protection as to their local retailers, the independents in the state. And we would point out that the PBMs, frankly, have worked very constructively with the independents by and large. The large chain pharmacies is where a lot of that competition comes from, and that's a different problem. But if you look at the Rutledge piece, for example, while in Arkansas, which is a bit ironic that it's in Arkansas, if you look at the largest company in Arkansas and the number of other businesses that they've sort of, shall we say, challenged to protect a particularly set of small businesses is an interesting approach. That being said, those retailers play an important role. We have never debated that. With the Rutledge decision, which is a fairly narrow interpretation, it's still -- risk is still protected. Plans can still design plans at a national level, which would include or exclude pharmacies that don't bring value and so forth. And what we're finding is there's plenty of pharmacies that will want to continue to provide value to our clients in the context of what Rutledge did. And so our job becomes influence along where we can, where it passes, then go back in and look at the other ways to drive affordability. We're actually really confident in Arkansas that we will be able to continue to drive affordability with the retailers to the end users. And we stay very engaged because we do know that -- I told someone the other day, our industry faces off against a couple of very tough forces, retail being one of them, that if we didn't exist, the pricing to the end user would be different. And we recognize that comes with the territory, and that's why we stay so engaged and try to work really, really hard to demonstrate the value that we create because I think that's important. And I do think, by the way, that there are other patient-friendly -- we can call it transparency, but patient-friendly ways to manage networks and execute them and so forth, using digital tools and others that we've invested heavily and that we believe really help the patient experience even as the payer is getting the benefit of potentially, say, a narrow network, for example. So we continue to recognize that at the end of the day, the people that vote within the legislators of these states are patients, and we need to do a great job serving them, and that's a big place that we invest.

That's super helpful. I think switching gears up a little bit more. I know you talked about the Prime relationship earlier. I think it's been about a year since that officially started. And so just wondering if you could just give an update on how that's been progressing, what the feedback has been from Prime? And I think initially when you announced this partnership, you talked about an immaterial impact to 2020 and then with a more positive contribution in 2021. And so is there any better sense you could give us on how to think through what that might be contributing this year just on a year-over-year basis?

Sure. Well, the answer to your last question is no. I'm not going to do that today and plan specific numbers. That being said, though, listen, we invested some money upfront certainly to bring Prime on first -- our first iteration, which was bringing them on to Ascent as well as doing some work on the retail side for them. We've invested yet again largely again around hiring people so we can provide amazing service because Prime did not have a great experience when the last time they made a major transition, and we want them to have an amazing experience plan by plan as they come on to our platform for Accredo and for [ Mail ]. And I can tell you so far, and I can't play the video for you, but I had Prime CEO recently address our top 500 leaders because I thought it was important. In Cigna, broadly important that all of our leaders hear directly how important what we do is for them, how they are counting on us to deliver and to innovate and to perform and how well we had done. And it was a very positive -- very, very positive report. And I think the net effect of that is that as the plans or making decisions, we've had now 2 ways of -- 3 ways, actually, I guess now of the Accredo implementations of individual plans inside of Prime 23 plans. I am strongly of the view that we are likely to have nearly -- if not all of them, nearly all of them come on to Accredo off of their current provider. And that's because we performed really, really well. And so that's obviously really good for us. In terms of the trust that it shows, it is our strategy in action, which is land in one place and the build trust and expand the relationship over time based on the needs of the client, not based on what we want to sell, based on the needs of the client and how we can in a really nimble fashion construct it in such a way as to work through them. And so what I would say is it couldn't be going much better right now. The one thing that I'm looking forward to, and Ken and I talk about this, is we have a great proposition. We've taken great care of Prime's owners and plans. They are benefiting massively. And he gave our team a number that I won't give you in terms of what he believes it's been worth to the plans. Well, what I want to see us do is add to Prime's stable of plans that they're actually serving. We have a great Blue's book of business. Prime has a great Blue's book of business. But there are plenty of other plans out in the marketplace who need a scale, help particularly specific to Blue's plans, and I believe Prime is beautifully positioned to provide services to them, and that's what we're really now pressing on. So it's a great relationship and one we're very proud of and one that does continue to grow.

That's great. Actually, I wanted to follow up on one of the comments you made. So on the specialty piece specifically, I mean, like you said, it sounds like a few plans that started in 2021. I mean what would the time line potentially look like for those other plans to move over? And how impactful could that potentially be?

What I love about it -- George Paz taught me this. I hope he's listening in on this. George Paz taught me this, which is it's always wonderful to have things ahead of you that you know are going to help contribute And the nice thing is, is that we will bring the last plans on until probably 1/1 of '22, which means that's going to be all incremental for '22. Not to mention a fairly good number of plans coming in the middle of this year, so you're going to get the annualization of that effect from a claims count standpoint and so forth as well as a cost absorption standpoint. And so to answer your question, though, we see the likely scenario would be that by early '22, we would have completed the implementation of the majority of plans. But we're following the plans lead. We are doing what the plan can digest in terms of the transition of those patients and so forth. The good news is the rate limiter is not going to be our ability to service the patients and the rate limiter is not going to be the plans concern that we won't do a good job. Those 2 things have been taken off the table by how well we perform so far.

That's super helpful.

Tim, I wanted to go over to the digital formulary. I think it's been a couple of years now since it was launched. I think it's a pretty ingenious innovative way of thinking about nontraditional therapeutics being on a formulary. Just wanted to get your updated thoughts kind of what adoption maybe has looked like. What's on the digital formulary? How do you envision this continuing to evolve?

Yes. It's a great question. And what I would say is it was a really good and appropriate innovation for us. It was natural because of our open architected approach. And also because we have clients that clearly were looking to validate what was just an exploding number of point solutions that were really -- not all of our clients are in a position, particularly the small and midsized ones, to even do the security validation you would want to do before you start sending data to some of these companies, right? And so we thought it was a great service that we provide our clients. And we also thought it was terrific for those clients who are using these point solutions that we'll be able to provide an integrated view from a patient standpoint, working -- [ La Fango ] is sort of my poster child in LifeScan where that data goes straight to our pharmacist real time, and so we can actually intervene or if we're talking to a patient, we can alert them or reinforce positive things that we see in the data and so forth. So from our standpoint, the uptake has been good. It's not -- I'm not going to tell you. First of all, we're never going to -- we didn't build it to be wildly profitable because we think it's an added service that makes us even stickier in terms of the core business that we provide. But we do like what it does. We've added a number of things in the musculoskeletal area and in the behavioral area because those are 2 cost areas that the market is very concerned about longer term and see the benefit of well-managed patients. And both of those behavioral and musculoskeletal don't just require you to go visit an outpatient clinic or go visit a human being in an office. There's an awful lot of appropriate care that can be delivered virtually or digitally. And so for us, it's early days. Not give a numbers of accounts, but we've had good uptake from employers. In some cases, even employers say, "Wow, I love that you validated it. I have a direct relationship with them anyway." But in some cases, we can get them a better price. But again, the price average values on that really wasn't the goal. The goal was an integrated experience that over the next 5 years, we could really build out. And ultimately, it would give us one more element of playing a role as the coordinator for the patients -- the clients that we have on a broader ecosystem basis. We launched Health Connect 360 a number of years ago that have put us sort of squarely in that position, and we've got more than a dozen health plans using that. We think the digital formulary sort of gave us that with employers as well. And I think over time, what you'll see is all of that come together into a strategy around coordinated services that will give us a place with our clients that will be very helpful.

No. Just a quick follow-up on that, Tim. Can you talk a little bit about what MDLIVE adds to this? Obviously, that was a fairly significant transaction, at least within this context. What does that enable you to do better or differently with the digital formulary?

Yes. I mean MDLIVE is a great investment for us. And to your point, the way we look at MDLIVE, and I'll come back to digital formulary because it's relevant to what I'm about to say is not -- we didn't just buy MDLIVE so that we had an urgent care capability or a simple place for patients to just go and get access to care. We view long term, MDLIVE can actually find its way into the more complex disease states, that we can work with providers to link providers to the patients in meaningful ways the patients are looking for. And then importantly, when you have that provider patient hookup and we're the chassis and helping the provider make that connection to the extent that we have whether it's pharmacy formularies or whether it's a digital formulary, your adherence and the ability to have the pick list for that provider really easily curated into the solutions that you know are value creating and, therefore, will be patient appropriate and so on and so forth is very high. And so we do absolutely view the ability to sort of have the integrated EMR for the MDLIVE patients to call it sort of like that, be very clear about the opportunities, and we can push opportunities at the point of that care that may otherwise be blind spots to the patient or to the provider that they're interacting with virtually. So do we think every encounter will be virtual in the future? No. We did say that we think point -- where care is delivered is one of the 3 fundamental vectors that we're really spending time thinking about. And we do think people -- whether it's skilled nursing facility at home sort of mindset or other things, post-acute care follow-up to keep people from going back in hospitals and virtually reconnecting with their provider after coming out of the hospital using the MDLIVE platform, we think there's just a lot that we can do there to take that platform and meaningfully deepen -- I don't know that it's even expand, deepen sort of the kind of care use cases that it's able to provide and the tools, including the -- our digital formulary that can be made available to those clinicians to actually leverage.

Tim, we just have a couple of minutes left. So I wanted to end on a longer-term question. As you think about Evernorth and obviously, there's a lot of things going on, a lot of changes both in internal and external factors. Is there anything you could do to help kind of frame how you've envisioned the long-term algorithm from a growth and profit standpoint? I know at your Analyst Day, you talked about longer-term margins of 4.5% to 5.5% kind of towards the lower end as we sit here today. What are some of the things that you think about to get you well within to the top end of that range from a profitability standpoint? And then how would you have investors think about the long-term top line perspectives of Evernorth?

Yes. I mean I think what you will see over time with Evernorth is increasingly, counting scripts or PBM wins is going to be the less and less important. We are not deemphasizing the PBM. We still think it's the great front door to care pharmacy is. So we're clear about that, right? But as our growth on the PBM side is on the lower end of what that range that we've indicated we think we can grow is and as we add materially services that are higher value and therefore higher margin off of the back of that PBM, what was -- the Prime relationship is a great example, right? So going in and doing Ascent and supply chain services, it's worth it for us to do. It's not a commodity, but it's certainly not nearly as interesting to us as caring for the most ill patients that those plans are actually covering, and that's more remunerative to us if we do our job well. And so as we grow specialty, as biosimilars become real, that will change the margin profile because we'll create additional value that we can keep a small piece of. As we look more broadly at a behavioral health offering or other care plus offerings as we call it, MDLIVE for others -- not for Cigna, but for other health plans that we can provide services to. Again, the services business, as you've seen in certain competitors is more profitable on a per dollar revenue basis than PBM is typically. If I go further and look at data and analytics as a service, particularly advanced analytics, we're being very thoughtful there because it's too easy to spend too much money to buy something that doesn't have much of a future in terms of some of that space. So we're being very, very thoughtful. But we think we've got a lot of internal assets that can be combined to do some very interesting things potentially. We already do some of them. Some of the highest profit things that we do today are really derived from our data and analytics capabilities as they apply to things like RationalMed for our pharmacy customers that they pay us for. So I think over time, what you'll see is we get to the top end of that. And fairly, if you model it, you don't have to believe some crazy stuff in order to say, "Wow, your business mix has evolved enough that you guys are doing more high-value services even as you continue to provide that really important core set of services called pharmacy benefit -- let's call it benefit management broadly, including on the eviCore side. And so from that standpoint, we see a lot to like there. The top line will kind of take care of itself when you do that. We're bottom line and capital use focused more than we are top line focused, if I'm honest. And investors kind of got to get comfortable with that, particularly, again, if you look at biosimilars, I'm hoping I depress my revenue for a period of time, but below biosimilars out to create the value that they offer. So that's kind of how we think about it.

No, that all makes good sense. I appreciate that. Well, we're just about up on time here. So I think it's a good place to wrap up. I wanted to thank Tim and Alexis for being with us today. Tim, always appreciate the discussion and your time. Thanks, everybody, for joining, and I hope everybody continues to enjoy the conference. Thanks so much.

Thanks, Bob.

Thanks.

Thank you.