Slide 1: Cigna to Acquire Express Scripts
CIGNA TO ACQUIRE EXPRESS SCRIPTS March 8, 2018
Slide 2: Important Information for Investors and Shareholders
Important Information for Investors and Shareholders CAUTIONARY NOTES ON FORWARD LOOKING STATEMENTS Information included or incorporated by reference in this communication, and information which may be contained in other filings with the Securities and Exchange Commission (the “SEC”) and press relea
Slide 3: Important Information for Investors and Shareholders
Important Information for Investors and Shareholders IMPORTANT INFORMATION ABOUT THE TRANSACTION AND WHERE TO FIND IT This communication does not constitute an offer to buy or solicitation of an offer to sell any securities. In connection with the proposed transaction, the newly formed company which
Slide 4: Important Information for Investors and Shareholders
Important Information for Investors and Shareholders NON-GAAP MEASURES AND OTHER KEY INFORMATION Throughout this presentation, we use various financial measures when describing its financial results and outlook that are not determined in accordance with accounting principles generally accepted in th
Slide 5: Participants
Participants David Cordani Cigna President and Chief Executive Officer Tim Wentworth Express Scripts President and Chief Executive Officer Eric Palmer Cigna EVP and Chief Financial Officer Will McDowell Cigna VP Investor Relations 5
Slide 6: Global Health Care Market Trends
Global Health Care Market Trends… Eroding health Changing role Technological Regulatory and Affordability and Aging population status of consumers innovation legislative climate accessibility challenges … Drive Key Needs for the People We Serve Customers Clients Health Care Professionals Communities
Slide 7: Cigna's Enterprise Strategy
Cigna’s Enterprise Strategy Combination with Express Scripts accelerates Cigna’s Enterprise Strategy Go Deeper Go Local Go Beyond Expands and deepens our Ensures our solution Further innovates and customer, client and partner suite and services meet differentiates our relationships; customer, client
Slide 8: Acquisition of Express Scripts Makes Health Care Simpler
Acquisition of Express Scripts Makes Health Care Simpler CUSTOMERS CLIENTS PARTNERS Consumer Choice Patient-Provider Alignment Personalized Value • Full suite of health engagement • Connective tissue between individuals • Build health care services around services and their health care providers cus
Slide 9: Combining Two Leading Health Services and Pharmacy Services Companies
Combining Two Leading Health Services and Pharmacy Services Companies Cigna Express Scripts Commercial Employer Core PBM Services − Industry leading medical trend − Differentiated Pharmacy Trend − Deeply integrated behavioral, medical and Broad Portfolio of − Home Delivery Pharmacy: Efficient specia
Slide 10: Our Beliefs as a Combined Company
Our Beliefs as a Combined Company Keep the healthy and at risk populations healthy Take full advantage Maximize adoption of of preventive care evidence-based care Deliver best in class Leveraging enhanced real Deliver industry leading quality of care for people time data across an innovation to supp
Slide 11: Combination Will Expand our Value Proposition for All Stakeholders
Combination Will Expand our Value Proposition for All Stakeholders Today Long-term Vision Be a trusted life and health care Ensure broad and seamless access to care Consumers (providers and pharmacies) + decision making partner, helping customers navigate their health journey Ensure employees have b
Slide 12: Transaction Overview
Transaction Overview • ~$67 billion cash and stock transaction Purchase Price & • Consideration consists of $48.75 and 0.2434 shares of stock of the combined company Consideration per Express Scripts share • Represents a premium of 31% over Express Scripts’ closing price as of March 7, 2018 Ownershi
Slide 13: Delivers Meaningful Shareholder Value
Delivers Meaningful Shareholder Value • Significantly broadens and strengthens Cigna’s growth profile • Strong EPS1 profile with double digit accretion in first full year post-close, excluding the impact of Express Scripts’ transitioning clients • Greater than ~$600 million of retained synergies, pr
Slide 14: Robust Future Revenue Growth
Robust Future Revenue Growth Revenue2 EXPECTED $123B ANNUAL REVENUE GROWTH 6-8% 2017 2021 Pro forma Projected Competitively attractive revenue growth across a diversified portfolio of businesses 14
Slide 15: Transaction Generates Strong, Diversified Earnings Profile
Transaction Generates Strong, Diversified Earnings Profile EPS $20–$21 Accretive • Stronger fundamental 2x in Year 1 demand for Cigna’s $2-$3 Accretion products and services • Improvements in cost of $10.46 care $18 Initial target • Operating efficiencies • Robust free cash flow generation 2017A 202
Slide 16: Sources & Uses of Capital
Sources & Uses of Capital Available Cash 7.2 • Upon closing, proforma New Debt and Commercial Paper 22.5 debt to capitalization ratio will be ~49% Sources ($B) Express Scripts Debt Assumed 13.2 • Prioritization of debt New Equity Issued in Transaction 26.6 repayment over other Total Sources 69.6 for
Slide 17: Driving Meaningful Stakeholder Value
Driving Meaningful Stakeholder Value • Enables Better Affordability, Clinical Quality and Customer Experiences Through: – Expanded Consumer Choice Health – Strengthened Patient-Provider Alignment and Connectivity Care – Broadened Access and Personalized Value System • Advances Ongoing Pursuit to Add
Slide 18: Appendix
APPENDIX
Slide 19: Definitions of Key Financial Terms
Definitions of Key Financial Terms 1Adjusted income from operations is defined as shareholders’ net income excluding the following after-tax adjustments: net realized investment results, net amortization of other acquired intangible assets and special items. Special items are excluded because manage