Cigna’s and Humana’s inventory slides on report of deal talks

“Humana is not commenting on the deal rumor,” an organization spokesperson advised MarketWatch. Cigna didn’t instantly reply to a request for touch upon the report.

The deal would mix two insurance coverage behemoths: Cigna’s market worth stands at about $83 billion, whereas Humana’s is about $62 billion.

The mixture would additionally meld Humana’s power in Medicare Advantage with Cigna’s dominance within the pharmacy-benefit-management enterprise. Humana has about 18% of whole 2023 Medicare Advantage enrollment, second solely to UnitedHealth Group Inc.
UNH,
-1.17%,
whereas Cigna has simply 2% of whole enrollment in these plans, in line with the health-policy analysis nonprofit KFF.

Cigna’s Express Scripts unit, in the meantime, is a prime pharmacy profit supervisor by market share. PBMs, which negotiate between drug corporations and well being insurers and might considerably affect sufferers’ and insurers’ prescription prices, have been scrutinized this 12 months by lawmakers and regulators seeking to shine mild on their contracts and pricing practices.

Some earlier makes an attempt at insurance-industry mega-deals have been beset by regulatory issues. A courtroom blocked Aetna’s proposed acquisition of Humana on antitrust grounds in 2017. Aetna was later acquired by CVS Health Corp.
CVS,
-3.04%.
Another well being insurer, Anthem, tried to accumulate Cigna, however that deal was additionally blocked in 2017 attributable to antitrust points. Anthem later modified its title to Elevance Health Inc.
ELV,
-2.60%.

Cigna’s inventory is down 20% within the 12 months so far, whereas Humana shares are down 3.5%.