The Cigna Group · NYSE:CI
The Cigna — Investor Day (March 2024)
33 slides from The Cigna's investor day presentation, Mar 7, 2024
Slide 1: Investor Day 2024
Investor Day 2024 • This is an abridged version of Investor Day slides. For full set of slides please visit https://investors.thecignagroup.com/events-and-presentations/default.aspx in the Investor Relations section of The Cigna Group’s website. Confidential, unpublished property of The Cigna Group.
Slide 2: Forward-looking statements
INVESTOR DAY 2024 Forward-looking statements CAUTIONARY STATEMENT FOR PURPOSES OF THE “SAFE HARBOR” PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995 This presentation, the Investor Day webcast of The Cigna Group (the “Company”) and oral statements made with respect to information c
Slide 3: Non-GAAP measures and other key financial information
INVESTOR DAY 2024 Non-GAAP measures and other key financial information Throughout this presentation, the term “adjusted earnings” means adjusted income (loss) from operations, and “adjusted earnings per share” or “adjusted EPS” means adjusted income (loss) from operations on a diluted per share bas
Slide 4: Two high-performing growth platforms
THE CIGNA GROUP Two high-performing growth platforms ~60% O F E A R N I N G S ~40% O F E A R N I N G S Cross-enterprise leverage is mutually beneficial Confidential, unpublished property of The Cigna Group. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel.
Slide 5: A decade of growth exceeding expectations
THE CIGNA GROUP A decade of growth exceeding expectations 13%+ annual Adj. $25.09 EPS growth Adj. EPS $7.29 Adj. EPS 2013 2023 Confidential, unpublished property of The Cigna Group. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2024 The Cigna Group
Slide 6: Raising long-term average annual adjusted EPS growth target
THE CIGNA GROUP Raising long-term average annual adjusted EPS 10–14% growth target Confidential, unpublished property of The Cigna Group. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2024 The Cigna Group
Slide 7: We see a surge in pharmacological innovation
THE CIGNA GROUP We see a surge in pharmacological innovation Surging demand for GLP-1s 40–45% Rx ~1,000 gene and cell % O F TOTA L C O S T O F C A R E therapies in the pipeline … vs. 25–30% 21 available today Rx 15–20% Rx Medical Medical Medical 2014 2024 2034 Confidential, unpublished property of T
Slide 8: Evernorth Health Services: Our attractive markets
E V E R N O R T H H E A LT H S E R V I C E S • O U R AT T R A C T I V E G R O W T H M A R K E T S ~60% OF EARNINGS Confidential, unpublished property of The Cigna Group. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2024 The Cigna Group
Slide 9: Raising the growth outlook for Evernorth
E V E R N O R T H H E A LT H S E R V I C E S • O U R AT T R A C T I V E G R O W T H M A R K E T S Raising the growth outlook for Evernorth O U R LO N G -T E R M CURRENT MARKET SHARE AV E R A G E A N N U A L A D D R E S SA B LE S E C U LA R AND BUYER GROUP ADJUSTED INCOME MARKET GROWTH E X PA N S I O
Slide 10: Evernorth growth outlook continues to increase
E V E R N O R T H H E A LT H S E R V I C E S • O U R AT T R A C T I V E G R O W T H M A R K E T S Evernorth growth outlook continues to increase on a revenue base that has grown $90B over 5 years 5–8% 2024 5–7% 2022 4–6% 2021 3–5% 2019 2–4% PRE-MERGER E V E R N O RT H LO N G -T E RM AV E R A G E A N
Slide 11: New quarterly disclosures starting 1Q 2024
E V E R N O R T H H E A LT H S E R V I C E S • O U R AT T R A C T I V E G R O W T H M A R K E T S New quarterly disclosures starting 1Q 2024 Revenue and adjusted operating earnings breakout for Pharmacy Benefit Services and Specialty and Care Services ~50% ~50% of earnings of earnings P H A R M A C
Slide 12: Specialty is larger than the Individual MA market and growing faster
E V E R N O R T H H E A LT H S E R V I C E S • A C C E L E R AT E D G R O W T H W I T H S P E C I A LT Y Specialty is larger than the Individual MA market and growing faster ~$400B ~$375B Specialty market Individual Medicare Advantage market Because of our unique strengths and capabilities, we will
Slide 13: We are the leader in the specialty pharmacy benefit space
E V E R N O R T H H E A LT H S E R V I C E S • A C C E L E R AT E D G R O W T H W I T H S P E C I A LT Y We are the leader in the specialty pharmacy benefit space PHARMACY M E D IC A L ~$240B B E N E F IT ~$160B B E N E F IT ~$400B direct to patient direct to provider Today, we serve Today, we serve
Slide 14: Specialty's impact on total cost of care
E V E R N O R T H H E A LT H S E R V I C E S • A C C E L E R AT E D G R O W T H W I T H S P E C I A LT Y Specialty’s impact on total cost of care 2–3% They account for of the population has 1/3 a specialty condition of the total of cost care Reduce overall cost of care A specialty patient’s total co
Slide 15: Biosimilar for Humira at Accredo
E V E R N O R T H H E A LT H S E R V I C E S • A C C E L E R AT E D G R O W T H W I T H S P E C I A LT Y Biosimilar for Humira at Accredo $0 patient out of pocket* $60M of patient savings annually, or $3,500 per patient annually *Evernorth plans to have available for eligible patients. Terms and con
Slide 16: Substantial biosimilar opportunity beyond Humira
E V E R N O R T H H E A LT H S E R V I C E S • A C C E L E R AT E D G R O W T H W I T H S P E C I A LT Y Substantial biosimilar opportunity beyond Humira By 2030, biosimilars and generics will launch for nearly half $100B annual specialty drug spend of the top 25 specialty will be open to competitio
Slide 17: We are the leader in this space
E V E R N O R T H H E A LT H S E R V I C E S • A C C E L E R AT E D G R O W T H W I T H S P E C I A LT Y Clinical expertise • 15 Therapeutic Resource Centers • Deep level of specialization • Unique to Accredo We are the leader Comprehensive access in this space • Manufacturers choose us • Leader in
Slide 18: CuraScript well positioned for future growth
E V E R N O R T H H E A LT H S E R V I C E S • A C C E L E R AT E D G R O W T H W I T H S P E C I A LT Y CuraScript well positioned for future growth CuraScript supplies less than 20% of Accredo Specialty spend Substantial growth opportunity over time Confidential, unpublished property of The Cigna
Slide 19: We serve a diverse mix of buyer group needs
E V E R N O R T H H E A LT H S E R V I C E S • PHARMACY BENEFIT SERVICES We serve a diverse mix of buyer group needs GOVERNMENT 30% H E A LT H P L A N S AND PROGRAMS 6% CIGNA H E A LT H C A R E 22% C O M M E R C IA L H E A LT H P L A N S A N D PA RT N E R S ~120M 9% FEDERAL E M P LOY E R S Pharmacy
Slide 20: EncircleRx cardiodiabesity value-based care
E V E R N O R T H H E A LT H S E R V I C E S • PHARMACY BENEFIT SERVICES EncircleRx Cardiodiabesity value-based care Introducing the first-ever Deep insights to ensure people GLP-1 who will benefit the most get it financial guarantee Combines clinically proven lifestyle modifications and support Con
Slide 21: Cigna Healthcare: Our attractive markets
C I G N A H E A LT H C A R E • O U R AT T R A C T I V E G R O W T H M A R K E T S ~40% OF EARNINGS Confidential, unpublished property of The Cigna Group. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2024 The Cigna Group
Slide 22: Cigna Healthcare growth outlook
C I G N A H E A LT H C A R E • O U R AT T R A C T I V E G R O W T H M A R K E T S Cigna Healthcare growth outlook O U R LO N G -T E R M CURRENT MARKET SHARE AV E R A G E A N N U A L A D D R E S SA B LE S E C U LA R AND BUYER GROUP ADJUSTED INCOME MARKET GROWTH E X PA N S I O N G R O W T H O U T LO O
Slide 23: Consistent and compelling track record of growth
C I G N A H E A LT H C A R E • U.S. EMPLOYER Consistent and compelling track record of growth 7.7 3-YEAR CAGR 7.7% 7.6 5-YEAR CAGR 7.5 7.5% REVENUE 7.4 7.3 10-YEAR CAGR 7.3% 7.2 2013 2018 2020 2023 Confidential, unpublished property of The Cigna Group. Do not duplicate or distribute. Use and distrib
Slide 24: Our multi-faceted approach to affordability
C I G N A H E A LT H C A R E • U.S. EMPLOYER Our multi-faceted approach to affordability ~60% Doubled our cost-competitive geographic footprint since 2019 ~30% Cost Cost competitive competitive in 2019 in 2024 Confidential, unpublished property of The Cigna Group. Do not duplicate or distribute. Use
Slide 25: We are the leader in Select market self-funded solutions
C I G N A H E A LT H C A R E • U.S. EMPLOYER We are the leader in Select market self-funded solutions SELF-FUNDED MIX IN SELECT MARKET Self-funded 30% 60% Fully insured Cigna Market Healthcare Our self-funded mix is 2x larger than the Select market mix Select Market = Employer clients with 50-499 li
Slide 26: Continued market share gains in Select segment give us a clear path for growth
C I G N A H E A LT H C A R E • U.S. EMPLOYER Continued market share gains in Select segment give us a clear path for growth 7% 5% We expect to double Select segment revenue in 5 years 2018 2024 SELECT SEGMENT MARKET SHARE Select Market = Employer clients with 50-499 lives Confidential, unpublished p
Slide 27: Enterprise adjusted income growth algorithm
THE CIGNA GROUP • FINANCIAL COMMITMENTS Enterprise adjusted income growth algorithm U.S. Employer 6–8% Pharmacy Benefit Services 2–4% Individual and Family Plans 10–15% Specialty and Care Services 8–12% International Health 8–10% 5–8% 7–10% 6–9% Confidential, unpublished property of The Cigna Group.
Slide 28: Sum of the Parts adjusted earnings growth algorithm
THE CIGNA GROUP • FINANCIAL COMMITMENTS Sum of the Parts adjusted earnings growth algorithm S P E C I A LT Y A N D C A R E S E R V I C E S ~30% OF EARNI NGS C I G N A H E A LT H C A RE 8–12% GROWTH ~40% OF EARNI NGS 7–10% GROWTH 6–9% GROWTH P H A R M A C Y B E N E F IT S E R V I C E S ~30% OF EARNI
Slide 29: Capital deployment: ~$60B
THE CIGNA GROUP • FINANCIAL COMMITMENTS ~20–25% C APITAL E X PE N DIT URE S AN D SUR PL US TO F UN D G R OW T H Capital deployment: ~$60B ~15% 4-5% cash flow over the DIVIDE N D EPS Growth next five years ~60–65% ST R AT E G IC M& A, SH AR E R E PUR C HASE , R E PAY DE BT Confidential, unpublished p
Slide 30: Strong long-term shareholder value
THE CIGNA GROUP • FINANCIAL COMMITMENTS Strong long-term shareholder value LONG-TERM AVERAGE LONG-TERM AVERAGE ANNUAL ANNUAL CONTRIBUTI ON ADJUSTED INCOME GROWTH 6–9% + FROM CAPITAL DEPLOYMENT 4–5% ENTERPRI SE 10–14% long-term average annual adjusted EPS growth outlook PLUS AN ATTRACTI VE DIVIDEND 1
Slide 31: Definitions of key financial and business terms
Definitions of key financial and business terms Medical care ratio represents medical costs as a percentage of premiums for all Cigna Healthcare risk products provided through guaranteed cost or experience-rated funding arrangements. Adjusted SG&A expense ratio represents enterprise selling, general
Slide 32: Reconciliation of GAAP to non-GAAP financial measures
Reconciliation of GAAP to non-GAAP financial measures Shareholders’ net income and diluted earnings per share Year Ended December 31 2023 2022 2021 2020 2019 2018 2017 2016 2015 2014 2013 Shareholders’ net income (loss) $17.39 $21.41 $15.75 $22.96 $13.44 $10.54 $8.77 $7.19 $8.04 $7.83 $5.18 Adjustme
Slide 33: Reconciliation of GAAP to non-GAAP financial measures
Reconciliation of GAAP to non-GAAP financial measures Adjusted Revenues Year Ended December 31 2023 Total Revenues $195,265 Net realized investment results from certain equity method investments $57 Adjusted Revenues $195,322 Confidential, unpublished property of The Cigna Group. Do not duplicate or