Anthem is starting its own pharmacy benefits manager to replace its contract with Express Scripts.
Anthem and CVS Health have signed a five-year agreement to launch IngenioRx. It will begin offering PBM services starting Jan. 1, 2020, coinciding with the end of Anthem's current contract with Express Scripts.
Anthem and Express Scripts have been at odds for some time. In April, Anthem said it would terminate its contract with Express Scripts when it expired on Dec. 31, 2019. It began engaging in a request for proposals for a new PBM service provider.
Express Scripts said it had proposed as much as $1 billion in annual price concessions in a new contract. But a year earlier, Express Scripts sued Anthem for deterioration of their drug pricing agreement, after Anthem had sued, claiming its PBM was making windfall profits because it wasn't passing on enough of the savings.
IngenioRx will serves customers of Anthem affiliated health plans, as well as non-Anthem customers in the national marketplace, the company said.
A PBM negotiates drug prices on behalf of payers and employers.
Anthem said it brings its member and provider engagement initiatives.
"During the past two years, we have been very clear that we can strengthen the value offered to the marketplace with an improved and aligned PBM model," said Anthem CEO Joseph Swedish. "Through the process of evaluating many PBM options in preparation for the expiration of our current contract, we determined that our scale and experience best position us to deliver an innovative solution, and the launch of IngenioRx will allow us to break through what is now a complex and fragmented landscape."
Brian T. Griffin, executive vice president, Commercial and Specialty Division, who oversees Anthem's pharmacy business, will continue to lead through the transition. Transition planning will focus on ensuring continuity of member coverage as Anthem migrates health plan members.