LAS VEGAS – As drug costs and spending continue to rise, demand for solutions opens the door to closer collaboration between payers and manufacturers.
Brian Evanko, president and chief operating officer of Cigna Group, and Miguel Fernández Alcalde, president of EMD Serono, spoke at a keynote session at AHIP 2026 earlier this month, discussing the delicate balance between promoting innovation and ensuring affordability.
The two companies are long-time partners and recently worked together on the cost of fertility treatments. Evernorth operates Freedom Fertility, the largest provider of specialty fertility pharmaceutical services in the U.S., while Merck Serono is a leading manufacturer in fertility.
Evanko said the partnership deepened last year, when both worked with the Trump administration to reduce the cost of certain fertility treatments. Patients can enroll in Trump Rx and find treatments at a cash price of between $1,000 and $1,500, depending on the number of doses in a treatment course, he said.
“From the beginning, Cigna Group was with us this year, being a partner more than a transactional collaborator, and we finally ended up with something that is huge,” Alcalde said. “It’s a great example of what can be done if all parties take care of the patient.
Both Evanko and Alcalde pointed to the effort as an example of what can be achieved if drugmakers and payers remove themselves from the battlefield and instead work collaboratively. Business and government plans are feeling the pressure of rising pharmaceutical costs, and much of the discussion has focused on who is to blame rather than how to move forward.
Evanko said innovation and affordability largely fall on two sides of the scale, and in the United States, historically the emphasis has been much more on driving innovation at the expense of affordability.
For example, he said that about 90% of new drugs are immediately available on the U.S. market, while in comparable countries that figure drops to 35%.
“We’re not very selective in terms of what comes to market, as long as it’s shown to be slightly better clinically than an older drug that already exists,” he said. “So the dilemma between innovation, access and affordability to date has been very problematic.”
On the other hand, the United States has a significant penetration of generic medications, since 90% of prescriptions are generic. However, most prescription costs come down to 10% of brand-name drugs, he said.
Alcalde stated that from the manufacturer’s perspective, addressing this balance is also an imperative. If newer models cannot come to fruition, the pace of innovation (and the creation of new life-saving treatments) will end up slowing.
“If we don’t start making those trade-offs, innovation won’t be sustained,” he said.
That’s where outcome-based pricing models come in. Evanko said value-based care in the pharmaceutical space represents an “untapped opportunity,” as while some of these contracts exist today, there is potential to significantly expand their use.
For example, one clear use case is gene therapies and other treatments that command prices in the millions. For many employers, a single worker needing one of these therapies could be financially devastating.
However, they also carry the potential to cure expensive and complex conditions. Working with drug makers to develop contracts based on the outcomes associated with the treatment could help soften the financial blow.
But making these relationships work requires engaging stakeholders beyond the payer or pharmacy benefit manager, potentially bringing the provider, the patient, government entities and others to the table, Evanko said.
“There is no one party that is going to solve everything, we know that we need to have strong partners (whether they are drug manufacturers or suppliers) to make these things come to life,” he said.
Alcalde said that, given the modern technologies available to the industry, there should be simpler pathways to developing value-based programs in pharmaceuticals, especially since it is not feasible to take a one-size-fits-all approach in this space.
Another element to consider, he said, is when to implement these models. For some therapies, it may make sense to begin the process of building a values-based agreement while it is still in active development.
“The value is not in manufacturing, but in R&D,” he said. “That is the value of our entire world, and it is not easy to put a value on a medicine, but yes, we have to do it.”
