Cigna Corp (NYSE:CI) is poised to benefit from the launch of bioequivalent Humira in July 2023, according to Morgan Stanley.
The Cigna Analyst: Ricky Goldwasser upgraded the rating for Cigna from Equal-Weight to Overweight, while raising the price target from $283 to $296.
The Cigna Thesis: The company acquired Express Scripts in 2019 and now Accredo, the legacy specialty pharmacy of Express Scripts, “has an opportunity to play a major role as the market transitions toward greater adoption of biosimilars when bioequivalent Humira launches in July 2023,” Goldwasser said in the upgrade note.
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“Management raised guidance on Evernorth’s [previously Cigna Behavioral Health] earnings growth by +100bps (+5-7% from +4-6%) at its recent 6/3 investor day... but our analysis suggests room for +200bp improvement after internal investments wind down and the full year benefit of Humira kicks in,” the analyst wrote.
In the case that Cigna leverages CuraScript, its specialty distribution business, to insource the distribution of Humira, there could be further upside, he added.
CI Price Action: Shares of Cigna had risen by 2.04% to $257.33 at the time of publication Wednesday.
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