Cigna Reiterates Continued Support for Proposed Merger with Express Scripts

BLOOMFIELD, Conn.–(BUSINESS WIRE)–Cigna Corporation (NYSE: CI) (“Cigna” or the “Company”) issued the
following letter to stockholders in response to the second letter
released by Carl C. Icahn about the Company’s proposed merger with
Express Scripts Holding Company (NASDAQ: ESRX) (“Express Scripts”).

Dear Cigna Shareholders:

This morning Carl Icahn released a second letter in opposition of our
combination with Express Scripts. Given Mr. Icahn continues to spread
innuendos and false information about the transaction, our Board of
Directors and management team wants to set the record straight once
again for our shareholders.

Cigna, over the past 8 years of regulatory and competitive disruption,
has a proven track record of delivering outstanding value for clients,
customers and shareholders – including 384% cumulative total shareholder
returns from December 31, 2009 through June 30, 2018. Our combination
with Express Scripts represents a strategically and financially
attractive path to continue to drive value for clients and customers in
close coordination with our physician partners and, as a result, deliver
outstanding value to our shareholders.

Our combination will lower costs and improve quality – a goal around
which everyone should be aligned. Cigna has been clear about the
expectation that cost improvements from the combination will flow
directly to clients and customers, while administrative cost savings
will flow to our shareholders – creating value for all stakeholders. We
also disagree in the strongest possible terms with Mr. Icahn’s
assertions that the failure of the combination would advance the greater
good of society. Cigna and Express Scripts have always taken our
societal responsibilities extremely seriously, and have provided
extensive illustrative materials of the benefits we believe this
combination would bring. We have not seen a single compelling piece of
evidence advanced by Mr. Icahn to the contrary.

Our combination with Express Scripts will be transformational
in the industry by combining two leading health care services companies
that together will have the capabilities, financial flexibility, reach
and expansion opportunities to create significant and immediate value
for clients, customers and shareholders. Specifically, as a combined
company we expect to:

  • Achieve a strategic goal (as previously communicated) to slow the rate
    of increase of drug and medical spending to a level that is more in
    line with the average increases of other goods in services in the U.S.
    (i.e., CPI) by 2021 for the benefit of our clients and customers.
  • Deliver mid-teens accretion in the first full year after closingand
    generate greater than $600 million in retained synergies annually – as
    a result, Cigna has raised its 2021 EPS target to $20 – $21 vs. prior
    guidance of $18. This does not take into account the additional
    savings that we will be able to generate for the benefit of our
    clients and customers.
  • Generate free cash flow of greater than $6 billion in 2021, allowing
    for rapid deleveraging and exceptional strategic and financial
    flexibility in a highly dynamic marketplace.

This is just naming a few of the expected benefits of the combination.
All of this will result in a flexible, innovative and strategic platform
that has the ability to win in more regulatory and competitive scenarios
than either company could ever do on a stand-alone basis.

Turning back to Mr. Icahn, it is clear he has no apparent interest in
understanding the underlying logic of our proposed deal with Express
Scripts, the current healthcare regulatory environment or the
unsustainable rise in drug costs in the U.S. We believe that his
last-minute, ill-founded campaign is motivated by a desire to profit off
of his stated “substantial short position” in Express Scripts by
leveraging his recently acquired 0.56% ownership stake in Cigna, despite
the value destruction that would result for other Cigna shareholders.

Mr. Icahn’s letter also misstates numerous facts about Cigna, Express
Scripts and the proposed transaction. The facts are:


Cigna’s Board and Senior Leadership.
Mr. Icahn’s unfounded assertion regarding Cigna’s Board and senior
leadership is false. Our Board and our senior leadership team are
and have always been 100% supportive of and committed to our
combination with Express Scripts. We remain committed to closing
the transaction by year-end 2018.


Rebates. Mr. Icahn’s assertion that
the value of our combination with Express Scripts will be
materially impaired if rebates are eliminated is false. The
elimination of rebates does not pose a material threat to the
value of our combination with Express Scripts
Additionally on Tuesday, HHS made an announcement that creates
even new opportunities for PBM capabilities to be used to improve
affordability and outcomes in Medicare Part B.


As we disclosed yesterday, rebates are applicable to less than 10%
of Express Scripts’ claims and it retains approximately $400
million of rebate dollars on a pre-tax basis. Furthermore, Express
Scripts is a pharmacy services company that provides
services well beyond PBM services as it:

  • Employs over 3,000 health care professionals to close gaps in care
    (e.g., improve adherence and reduce waste);
  • Helps those who struggle with complex diseases like cancer, HIV,
    mental illness and other conditions that require the holistic
    specialized care model only Express Scripts provides;
  • Has a specialty pharmacy, Accredo®, which helps bring
    together a patient’s pharmacy, medical and home-based services to
    drive better outcomes;
  • Has 10 innovative, industry-leading SafeGuardRx programs to improve
    care and value for customers through a suite of solutions that target
    therapy classes that pose clinical challenges for customers and a
    significant budget threat to their clients (e.g., inflammatory
    conditions, diabetes);
  • Redefined patient benefit management through its acquisition of
    eviCore in 2017, an innovative evidence-based medical benefit
    management services company that provides, among other things,
    utilization management services for health plans and employers; and
  • Saved $32 billion for its clients in 2017 through its costs savings
    programs, excluding any value derived from rebates and retail

As a result, there are a number of ways it gets paid for its
services – all of which are at the option of the client.  Whatever
amount Mr. Icahn’s companies are paying to Express Scripts, they
are doing so because Express Scripts is delivering value in a
variety of ways and Mr. Icahn’s companies are willing to pay for
that value.


Our physician partners recognize this value as well.  We have
received overwhelmingly positive feedback from them that they see
our combination with Express Scripts as an opportunity to improve
affordability and quality for their patients, who are our


Amazon. Mr. Icahn’s assertion that
Amazon’s entry into mail order pharmacy is a reason not to pursue
a combination with Express Scripts is ill-informed. Amazon
recently announced its plans to acquire PillPack, an in-network
pharmacy that contracts with pharmacy benefit managers, including
Express Scripts, as stated on PillPack’s

Express Scripts operates the largest mail order pharmacy that
dispenses over 330 million adjusted prescriptions annually. It
delivers outstanding quality and service results, is part of a
clinically integrated set of services and is supported by a number
of proprietary patents.
We do not view PillPack’s current business model as a direct
competitor to PBMs, which offer greater value-add capabilities
beyond mail order pharmacy. We see mail order pharmacy as just one
of the capabilities that Express Scripts brings to bear and is not
where we see the greatest value-add for the combination.
When the broad range of capabilities of Express Scripts (including
its data and data management tools) are combined with Cigna’s health
engagement, clinical tools and deep physician partnerships, we will
  • Unrivaled Predictive Capabilities. Over
    80 million Americans (roughly 25% of the population) are currently
    healthy but with a meaningful health risk. Together, Cigna and Express
    Scripts will have combined medical/pharmacy information for over 100
    million customers and flexible technology to share insights from that
    data in an actionable way – including the ability to predict health
    and treatment adherence risks. Having the capability to assist
    individuals to lower health risks that they do not even know exist
    will improve quality of life and lower costs.
  • Seamless Coordinated Care and Treatment.
    We will deepen relationships with physicians (through our 500+
    collaborative accountable care organizations); pharmacists (through
    our pharmacy networks); and drug manufacturers (through our supply
    chain management) and be able to coordinate pharmacy, medical and
    behavioral healthcare and treatment – even for the most complex cases.
    Additionally, together we will employ over 7,000 clinical
    professional, including Accredo’s 500 home infusion nurses, working to
    improve the health of our over 100 million customers.
  • Aligned Incentives. We will have the
    tools, information and reach to lead the value-based and
    outcomes-based reward structure across the healthcare spectrum and
    will be rewarded based on the value we generate for the benefit of
    clients and customers. As Cigna has done in the medical arena, the
    combined company will lead a transition to value based and aligned
    incentive arrangements in the pharmacy space as well – all with the
    goal of improving quality and value.

Finally, social responsibility is something that Cigna takes very
seriously. In May 2016, we set a goal to reduce the use of prescription
opioids among its members by 25% in three years. A full year ahead of
its schedule, Cigna recently announced that, working with its physician
partners, it has achieved that goal. Now, we have turned our attention
to a new challenge. We will collaborate with employers, customers,
prescribing clinicians, pharmacists and community-based organizations to
reduce the number of opioid overdoses by 25% among our commercial
customers by December 2021. The combined company will have more
end-to-end insights and information, as well as additional reach to
drive further alignment in ways that matter.

Our combination with Express Scripts is much more than the rhetoric and
misinformation that Mr. Icahn would have our shareholders believe. It
simply cannot be boiled down to rebates or Amazon or any other red
herring issue that Mr. Icahn wants to seek to use as a scare tactic to
support his own personal agenda.

For these reasons, Cigna’s Board and senior leadership continue to
believe that the proposed merger with Express Scripts is in the best
interest of shareholders and continue to recommend that Cigna
shareholders vote “FOR” the Express Scripts transaction.

If you have any questions, or need assistance in voting
shares, please call our proxy solicitor:

TOLL-FREE, at 1 (877)
750-9498 (from the US and Canada)

or +1 (412) 232-3651 (from
other locations).


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 releases or
other public statements, contains or may contain forward-looking
statements. These forward-looking statements include, among other
things, statements of plans, objectives, expectations (financial or
otherwise) or intentions, including statements concerning the potential
future performance of Cigna, Express Scripts, or the combined company,
the potential for new laws or regulations, or any impact of any such new
laws or regulations, including on the business of Cigna, Express Scripts
or the combined company, the ability to achieve the anticipated benefits
of the proposed merger, on the expected timeline or at all, the timeline
for deleveraging the combined company, and the ability to consummate the
proposed merger, on the anticipated timeline or at all, and other
statements regarding the parties’ future beliefs, expectations, plans,
intentions, financial condition or performance. You may identify
forward-looking statements by the use of words such as “believe,”
“expect,” “plan,” “intend,” “anticipate,” “estimate,” “predict,”
“potential,” “may,” “should,” “will” or other words or expressions of
similar meaning, although not all forward-looking statements contain
such terms.

Forward-looking statements, including as they relate to Express Scripts
or Cigna, the management of either such company, the transaction or any
expected benefits of the transaction, involve risks and uncertainties.
Actual results may differ significantly from those projected or
suggested in any forward-looking statements. Express Scripts and Cigna
do not undertake any obligation to release publicly any revisions to
such forward-looking statements to reflect events or circumstances
occurring after the date hereof or to reflect the occurrence of
unanticipated events. Any number of factors could cause actual results
to differ materially from those contemplated by any forward-looking
statements, including, but not limited to, the risks associated with the

  • the inability of Express Scripts and Cigna to obtain stockholder or
    regulatory approvals required for the merger or the requirement to
    accept conditions that could reduce the anticipated benefits of the
    merger as a condition to obtaining regulatory approvals;
  • the possibility that the anticipated benefits from the merger cannot
    be realized in full, or at all or may take longer to realize than
  • a longer time than anticipated to consummate the proposed merger;
  • problems regarding the successful integration of the businesses of
    Express Scripts and Cigna;
  • unexpected costs regarding the proposed merger;
  • diversion of management’s attention from ongoing business operations
    and opportunities;
  • potential litigation associated with the proposed merger;
  • the ability to retain key personnel;
  • the availability of financing;
  • effects on the businesses as a result of uncertainty surrounding the
    proposed merger;
  • the ability of the combined company to achieve financial, strategic
    and operational plans and initiatives;
  • the ability of the combined company to predict and manage medical
    costs and price effectively and develop and maintain good
    relationships with physicians, hospitals and other health care
  • the impact of modifications to the combined company’s operations and
  • the ability of the combined company to identify potential strategic
    acquisitions or transactions and realize the expected benefits of such
  • the substantial level of government regulation over the combined
    company’s business and the potential effects of new laws or
    regulations or changes in existing laws or regulations;
  • the outcome of litigation relating to the businesses of Express
    Scripts and Cigna, regulatory audits, investigations, actions and/or
    guaranty fund assessments;
  • uncertainties surrounding participation in government-sponsored
    programs such as Medicare;
  • the effectiveness and security of the combined company’s information
    technology and other business systems;
  • unfavorable industry, economic or political conditions, including
    foreign currency movements;
  • acts of war, terrorism, natural disasters or pandemics; and
  • the industry may be subject to future risks that are described in SEC
    reports filed by Express Scripts and Cigna.

You should carefully consider these and other relevant factors,
including those risk factors in this communication and other risks and
uncertainties that affect the businesses of Express Scripts and Cigna
described in their respective filings with the SEC, when reviewing any
forward-looking statement. These factors are noted for investors as
permitted under the Private Securities Litigation Reform Act of 1995.
Investors should understand it is impossible to predict or identify all
such factors or risks. As such, you should not consider either foregoing
lists, or the risks identified in SEC filings, to be a complete
discussion of all potential risks or uncertainties, and should not place
undue reliance on forward-looking statements.


This communication does not constitute an offer to sell or solicitation
of an offer to buy any securities. In connection with the proposed
transaction, the newly formed company which will become the holding
company following the transaction (“Holdco”) filed with the SEC a
registration statement on Form S-4. The registration statement on Form
S-4 includes a joint proxy statement of Cigna and Express Scripts that
also constitutes a prospectus of Holdco. The registration statement was
declared effective by the SEC on July 16, 2018, and Cigna and Express
Scripts commenced mailing the definitive joint proxy
statement/prospectus to the respective stockholders of Cigna and Express
Scripts on or about July 17, 2018. Cigna and Express Scripts also plan
to file other relevant documents with the SEC regarding the proposed
transaction. This document is not a substitute for the registration
statement or the joint proxy statement/prospectus or any other document
which Cigna, Express Scripts or Holdco may file with the SEC. INVESTORS
free copy of the registration statement on Form S-4 and the definitive
joint proxy statement/prospectus and other relevant documents filed by
Holdco, Cigna and Express Scripts with the SEC at the SEC’s website at
Copies of documents filed with the SEC by Cigna will be available free
of charge on Cigna’s website at
or by contacting Cigna’s Investor Relations Department at (215)
761-4198. Copies of documents filed with the SEC by Express Scripts will
be available free of charge on Express Scripts’ website at
or by contacting Express Scripts’ Investor Relations Department at (314)


Cigna (and, in some instances, Holdco) and Express Scripts and their
respective directors and executive officers may be deemed to be
participants in the solicitation of proxies in respect of the proposed
transaction under the rules of the SEC. Investors may obtain information
regarding the names, affiliations and interests of directors and
executive officers of Cigna (and, in some instances, Holdco) in Cigna’s
Annual Report on Form 10-K for the year ended December 31, 2017, which
was filed with the SEC on February 28, 2018, and its definitive proxy
statement for its 2018 Annual Meeting, which was filed with the SEC on
March 16, 2018. Investors may obtain information regarding the names,
affiliations and interests of Express Scripts’ directors and executive
officers in Express Scripts’ Annual Report on Form 10-K for the year
ended December 31, 2017, which was filed with the SEC on February 27,
2018, and its proxy statement for its 2018 Annual Meeting, which was
filed with the SEC on March 29, 2018. You may obtain free copies of
these documents at the SEC’s website at,
at Cigna’s website at
or by contacting Cigna’s Investor Relations Department at (215)
761-4198. Copies of documents filed with the SEC by Express Scripts will
be available free of charge on Express Scripts’ website at
or by contacting Express Scripts’ Investor Relations Department at (314)
810-3115. Other information regarding the participants in the proxy
solicitation and a description of their direct and indirect interests,
by security holdings or otherwise, is contained in the joint proxy
statement/prospectus and other relevant materials filed or to be filed
with the SEC regarding the proposed transaction. Investors should read
the joint proxy statement/prospectus carefully and in its entirety
before making any voting or investment decisions.


This communication is for informational purposes only and not intended
to and does not constitute an offer to subscribe for, buy or sell, the
solicitation of an offer to subscribe for, buy or sell or an invitation
to subscribe for, buy or sell any securities or the solicitation of any
vote or approval in any jurisdiction pursuant to or in connection with
the proposed transaction or otherwise, nor shall there be any sale,
issuance or transfer of securities in any jurisdiction in contravention
of applicable law. No offer of securities shall be made except by means
of a prospectus meeting the requirements of Section 10 of the Securities
Act of 1933, as amended, and otherwise in accordance with applicable law.

Permission to use quotes was not sought or obtained.


Cigna Corporation
Will McDowell, Investor Relations
Asensio, Media Relations