Impacted: Health plan clients

What you need to know

Yesterday, Cigna Group (Cigna), owner of Express Scripts (ESI), announced what they are calling “rebate-free” pharmacy benefits, which seeks to provide additional options for lowering costs and supporting community pharmacies.

Prime shares these goals of lowering costs and supporting the broader pharmacy market — and has long been committed to addressing transparency, affordability and access for our health plan clients and members in innovative and actionable ways. The following communication sheds light on key aspects of Cigna’s announcement and, importantly, details Prime’s distinctive approach to providing solutions to challenges of transparency, affordability and pharmacy sustainability. 

Prime commends all pharmacy benefit companies working toward a broader goal of creating a more affordable and sustainable health care system and continues to work toward market-leading approaches as a company and in partnership with the broader pharmacy benefit industry.

Overview of Cigna's announcement

Cigna announced a “rebate-free” model, shifting manufacturer rebate value to the point-of-sale (POS) as opposed to retrospective application. Cigna Healthcare will adopt this POS model for its fully insured lives beginning in 2027. The model will also be available as the standard option to ESI and Evernorth pharmacy benefit management (PBM) clients in 2028. Importantly, ESI PBM clients still have the flexibility to choose to continue with traditional rebate-based pricing models, and this new pricing model won’t apply to government programs through Medicare and Medicaid.

According to Cigna's announcement, plan members will receive the lowest cost for prescription drugs at the POS, whether through negotiated price (i.e., net of POS rebate), copay, cash discount programs, or direct-to-consumer (DTC) prices. Additionally, Evernorth will introduce a reimbursement model that compensates pharmacies based on their cost for medications (i.e., acquisition cost) plus a dispensing fee. Cigna also said they will provide incentives for clinical care services they provide to patients.

Prime's approach to transparency, affordability and pharmacy sustainability

Through the Pharmaceutical Care Management Association (PCMA), Prime has worked with Cigna and other PBMs to evolve our industry to deliver on our commitments to transparency, affordability and pharmacy sustainability. In fact, Prime leadership has been integrally involved in discussions on this topic at the White House, Centers for Medicare & Medicaid Services (CMS) and the Department of Health & Human Services (HHS) to address transparency, affordability, pharmacy sustainability and biosimilars. 

Cigna’s announcement reflects the competitive and patient-first market that we operate in, as well as a commitment to client and employer choice and flexibility that we also share. Just as Cigna’s approach to addressing key industry challenges and criticisms are unique to its business and client needs, Prime currently provides a number of distinct and innovative products and initiatives to solve for these shared goals the pharmacy benefits space, with a special focus on patient affordability. We have detailed these programs below for your awareness.

• Transparency: Prime helps clients share value with patients — this includes a 100% rebate pass-through to our health plan clients, as well as point-of-sale rebate option for plans. Additionally, our MedsYourWay™ product integrates discount card programs already accepted by pharmacies into the adjudication process to return the lowest price for members, directly lowering health care costs at the pharmacy counter. Prime’s industry-leading, tech-native tools support transparent, informed health care decision-making for patients seeking to manage drug costs by exploring low-cost alternatives. As initiatives to support DTC drug sales continue to gain traction, Prime is evaluating how to incorporate DTC pricing and channels into MedsYourWay. We also offer clients plan design rules that cap member exposure at net of rebate cost during the deductible phase and use the net cost for calculating their percentage copay. 
• Affordability: Prime’s low-net-cost model prioritizes the lowest total cost of medications for patients — after accounting for rebates, discounts and acquisition costs — rather than maximizing rebate revenue. This model is offered as part of a transparent and per member per month (PMPM) pricing structure, enabling predictable budgeting and aligned incentives. Additionally, Prime champions the use of biosimilars when it is the right option for clients and their members. In total, Prime’s commitment to supporting uptake of biosimilars has saved clients more than $2 billion.
• Pharmacy sustainability: Prime is launching PriceSync, a new NADAC reference-based pharmacy pricing model, by the end of this year. This innovative solution will further our goals of transparency, predictability and sustainability in our approach to retail network reimbursement. PriceSync will complement other cost-plus contracts currently available to our clients. Prime continues to offer a quality network option to support rural pharmacies — and has been an industry leader in its support of the rural pharmacy community for years. Specifically, Prime supports a pharmacy reimbursement model that recognizes and rewards pharmacies for delivering clinical care services that improve patient outcomes.

Prime remains committed to driving innovation that enhances transparency, lowers costs and strengthens the pharmacy network – all part of our focus to bring value and affordability to our clients and the patients we serve.

Strategic relationship with ESI and ownership stake in Ascent and other GPOs

Prime maintains a strategic engagement with ESI. This relationship, renewed in 2025, enables Prime to access value at scale while preserving our independence in formulary design, network strategy and client engagement. 

Importantly, Prime holds a strategic ownership interest in Ascent Health Services and other group purchasing organizations (GPO) that negotiate manufacturer contracts for both Prime and ESI. Prime’s ownership stake and influence gives Prime board-level influence to set strategy and oversight in Ascent. Our GPOs ensure we can deliver innovative, flexible and transparent solutions for our clients — now and in the future.

Given our strategic ownership interest, we are engaged in any contracting process and will be at the table every step of the way to ensure our clients’ needs are met and that these contracts are aligned with market movement towards enhanced transparency and affordability.

Reinventing the supply chain with ESI and owenership stake in Ascent and other GPOs

Prime is leading a reinvention of the pharmacy value chain to increase transparency, enhance affordability through new value streams, future-proof net cost of care against regulatory shifts and industry consolidation, and provide flexibility so clients can choose the network, formulary and benefit design that best suits their needs. Prime’s comprehensive client value approach is a continuation of work we’ve been doing for years to ensure our clients are ahead of the curve.

Cigna’s move to POS rebates by 2027 is a validation of Prime’s commitment to being an industry leader in providing a more affordable and sustainable pharmacy benefit solutions. In line with what Cigna is now offering to their pharmacy benefit clients, Prime will continue to support rebate pass-through and POS discounts, cost-plus arrangements and client-specific value modeling to ensure savings are real and measurable. 

Questions

Reach out to your Prime account team representative.