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UnitedHealth (UNH) Unit Makes Insulin More Affordable to Avail
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The pharmacy benefit manager, Optum Rx, a sub-unit of UnitedHealth Group Incorporated’s (UNH - Free Report) segment Optum, recently transferred eight products to tier one on its standard formulary. The shifted products comprise all short and rapid-acting insulins and due to the transfer under tier one, consumers will have to pay the lowest cash price for availing them.
Currently, more than 70% of Optum Rx users have access to insulin for less than $35 per month. The change in the formulary of Optum Rx will endow relief to 98% of its users, who can avail insulin for $35 or less per month from Jan 1 of next year.
The latest move reflects Optum Rx’s sincere efforts to enhance access, provide more choices and reduce costs for availing insulin. Needless to say, improved health conditions of consumers also remain the outcomes of such a formulary decision.
Drug manufacturers enjoy their sole authority over determining and increasing prescription drug prices but charging high prices for the life-saving medication, insulin, can often lead patients to reduce or skip doses. And it is herein that the role of pharmacy benefit managers like Optum Rx comes into existence. Pharmacy benefit managers create formularies and directly negotiate for rebates or discounts with drug manufacturers.
Bringing cost-effectiveness to consumers in availing essential medicines remains the ulterior motive of Optum Rx and it is expected to pursue a similar strategy in the future as well. Worthy of mentioning, 170 unique medications form a part of the Optum Rx Critical Drug Affordability program and can be availed by consumers at $35 or less. Reduction in drug prices seems to be of dire need amid the escalating healthcare expenses and therefore, may serve as a means to retain existing customers or lure new ones to avail the services provided by Optum Rx.
A growing customer base is likely to fetch more revenues to the sub-unit and subsequently, provide an impetus to the performance of its parent company in the days ahead. The Optum unit contributed 14.8% to UnitedHealth Group’s overall revenues in the first nine months of 2023.
As a testament to continuous efforts to make critical medicines more affordable, Optum Rx added two biosimilars, which are cost-effective substitutes for HUMIRA, to its standard formulary this June. It also introduced a consumer solution at the beginning of 2023 that ensures its users access to the lowest available drug prescription price through effective comparison between available direct-to-consumer pricing for traditional generic drugs and insurance pricing.
Last year, Optum Rx extended a helping hand to UnitedHealthcare for waiving copays linked with buying insulin and other critical drugs (for treating serious allergic reactions, hypoglycemia, opioid overdoses and acute asthma attacks) by consumers in group fully insured plans.
Shares of UnitedHealth have gained 5.4% in the past year compared with the industry’s 2.8% growth. UNH currently carries a Zacks Rank #3 (Hold).
Bausch Health’s earnings surpassed estimates in three of the last four quarters and missed the mark once, the average surprise being 0.04%. The Zacks Consensus Estimate for BHC’s 2023 earnings indicates a 10.1% improvement from the prior year’s reported figure, while the same for revenues suggests 6.2% growth. The consensus mark for BHC’s 2023 earnings has moved 2.7% north in the past 30 days.
The bottom line of Addus HomeCare outpaced earnings estimates in each of the last four quarters, the average surprise being 9.68%. The Zacks Consensus Estimate for ADUS’s 2023 earnings indicates a 16.9% improvement from the prior year’s reported figure, while the same for revenues suggests 11.1% growth. The consensus mark for ADUS’s 2023 earnings has moved 2.8% north in the past 30 days.
Centene’s earnings surpassed estimates in two of the last four quarters and missed the mark twice, the average surprise being 5.62%. The Zacks Consensus Estimate for CNC’s 2023 earnings indicates a 14.9% improvement from the prior year’s reported figure, while the same for revenues suggests 4.4% growth. The consensus mark for CNC’s 2023 earnings has moved 2.8% north in the past 30 days.
Shares of Bausch Health, Addus HomeCare and Centene have declined 4.6%, 22.2% and 12.4%, respectively, in the past year.
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UnitedHealth (UNH) Unit Makes Insulin More Affordable to Avail
The pharmacy benefit manager, Optum Rx, a sub-unit of UnitedHealth Group Incorporated’s (UNH - Free Report) segment Optum, recently transferred eight products to tier one on its standard formulary. The shifted products comprise all short and rapid-acting insulins and due to the transfer under tier one, consumers will have to pay the lowest cash price for availing them.
Currently, more than 70% of Optum Rx users have access to insulin for less than $35 per month. The change in the formulary of Optum Rx will endow relief to 98% of its users, who can avail insulin for $35 or less per month from Jan 1 of next year.
The latest move reflects Optum Rx’s sincere efforts to enhance access, provide more choices and reduce costs for availing insulin. Needless to say, improved health conditions of consumers also remain the outcomes of such a formulary decision.
Drug manufacturers enjoy their sole authority over determining and increasing prescription drug prices but charging high prices for the life-saving medication, insulin, can often lead patients to reduce or skip doses. And it is herein that the role of pharmacy benefit managers like Optum Rx comes into existence. Pharmacy benefit managers create formularies and directly negotiate for rebates or discounts with drug manufacturers.
Bringing cost-effectiveness to consumers in availing essential medicines remains the ulterior motive of Optum Rx and it is expected to pursue a similar strategy in the future as well. Worthy of mentioning, 170 unique medications form a part of the Optum Rx Critical Drug Affordability program and can be availed by consumers at $35 or less. Reduction in drug prices seems to be of dire need amid the escalating healthcare expenses and therefore, may serve as a means to retain existing customers or lure new ones to avail the services provided by Optum Rx.
A growing customer base is likely to fetch more revenues to the sub-unit and subsequently, provide an impetus to the performance of its parent company in the days ahead. The Optum unit contributed 14.8% to UnitedHealth Group’s overall revenues in the first nine months of 2023.
As a testament to continuous efforts to make critical medicines more affordable, Optum Rx added two biosimilars, which are cost-effective substitutes for HUMIRA, to its standard formulary this June. It also introduced a consumer solution at the beginning of 2023 that ensures its users access to the lowest available drug prescription price through effective comparison between available direct-to-consumer pricing for traditional generic drugs and insurance pricing.
Last year, Optum Rx extended a helping hand to UnitedHealthcare for waiving copays linked with buying insulin and other critical drugs (for treating serious allergic reactions, hypoglycemia, opioid overdoses and acute asthma attacks) by consumers in group fully insured plans.
Shares of UnitedHealth have gained 5.4% in the past year compared with the industry’s 2.8% growth. UNH currently carries a Zacks Rank #3 (Hold).
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Stocks to Consider
Some better-ranked stocks in the Medical space are Bausch Health Companies Inc. (BHC - Free Report) , Addus HomeCare Corporation (ADUS - Free Report) and Centene Corporation (CNC - Free Report) . While Bausch Health currently sports a Zacks Rank #1 (Strong Buy), Addus HomeCare and Centene carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Bausch Health’s earnings surpassed estimates in three of the last four quarters and missed the mark once, the average surprise being 0.04%. The Zacks Consensus Estimate for BHC’s 2023 earnings indicates a 10.1% improvement from the prior year’s reported figure, while the same for revenues suggests 6.2% growth. The consensus mark for BHC’s 2023 earnings has moved 2.7% north in the past 30 days.
The bottom line of Addus HomeCare outpaced earnings estimates in each of the last four quarters, the average surprise being 9.68%. The Zacks Consensus Estimate for ADUS’s 2023 earnings indicates a 16.9% improvement from the prior year’s reported figure, while the same for revenues suggests 11.1% growth. The consensus mark for ADUS’s 2023 earnings has moved 2.8% north in the past 30 days.
Centene’s earnings surpassed estimates in two of the last four quarters and missed the mark twice, the average surprise being 5.62%. The Zacks Consensus Estimate for CNC’s 2023 earnings indicates a 14.9% improvement from the prior year’s reported figure, while the same for revenues suggests 4.4% growth. The consensus mark for CNC’s 2023 earnings has moved 2.8% north in the past 30 days.
Shares of Bausch Health, Addus HomeCare and Centene have declined 4.6%, 22.2% and 12.4%, respectively, in the past year.