CVS Health to lose PBM deal with Blue Shield of California - WSJ
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Non-profit health insurer Blue Shield of California said it would drop CVS Healthâs (NYSE:CVS) Caremark as its pharmacy-benefit manager in favor of a new approach for negotiating drug prices with manufacturers, The Wall Street Journal reported on Thursday.
Blue Shield, which caters to about 4.8M members through its healthcare plans, will instead rely on multiple partners, including e-commerce giant Amazon.com (NASDAQ:AMZN) and Mark Cuban Cost Plus Drug Company to deliver its PBM function.
According to The Journal, the arrangement expected to launch in 2025 includes at-home drug delivery from Amazon (AMZN) and low-cost drugs from Mark Cuban Cost Plus Drug Company. Another firm, known as Abarca, will process drug claims.
However, CVS Caremark will continue to offer specialty pharmacy drugs used to treat its members with complex conditions, the Oakland-based managed care organization noted in a press release.
Blue Shield also said that other U.S. insurers and employers would also be able to follow its new system, which it expects will generate $500M in annual savings, or 10%â15% of its current expenditure on drugs.
The health insurer added that the program is on track for a limited rollout next year and that the savings from the system would be passed along to customers.
In addition to Caremark, Cignaâs (CI) Express Scripts, UnitedHealthâs (UNH) OptumRx, and IngenioRx of Elevance (ELV) dominate the PBM industry.

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