Lisa Gill: Great, thanks very much, and good morning. First, Shawn, I want to say thank you for revising 2024 – I think that that’s a very realistic expectation and I like the words of potential upside. With that said, let me move to my question, and that’s really around GLP1s. As I think about the different components of the business, I heard you and Dan both talk about the fact that commercial was in line, but just given the strength of what you’re seeing on your pharmacy side of your business, is there not any impact on the medical side of your business due to GLP1s, and then secondly, as we think about both GLP1s, biosimilars, the strength in the Rx services component of the business, can you maybe just walk through what some of those components are?
Are we starting to see more rebating activity around GLP1s? I know Karen had made a comment around programs around obesity and diabetes. If you can talk anything around that as to how we think about that going forward and the pharmacy services business, and then just lastly on the pharmacy services business, any incremental comments on how to think about the ’24 selling season and how that went?
Karen Lynch: Hi Lisa, it’s Karen, and I’ll start and hand it over to David Joyner and the rest of the team here. As you mentioned, we have seen, consistent with the industry, higher levels of utilization in GLP1 drugs across each of our businesses. In HCB, what we saw was that–you know, we have seen increased utilization but we feel like we have priced appropriately for it, and so we feel like the risk is manageable in that business. As you look at the pharmacy services business, we believe this is going to be a competitive category for us over time, and quite frankly is the reason why, as you know, PBMs exist. We have the opportunity to create competitiveness, provide lowest net cost, give additional programs like the programs I mentioned in my prepared remarks.
Also, what we’re seeing in the PCW business is it is generating very strong revenue there, but as you know with branded drugs, there is not a lot of margin with those kinds of drugs, so kind of overall, each of the businesses kind of have GLP1 in them and they are impacting them in a variety of different ways. But I would just re-emphasize the importance of the PBM and how we will continue to drive lowest net cost, and this is a perfect category to do that in. Let me turn it over to David to talk about what he’s seeing on growth in the pharmacy services business and the selling season.
David Joyner: Sure. Lisa, this is David, and thanks for the question. As we look forward into 2024, we obviously have the headwinds of the partial termination of Centene, and obviously we’re working close with the orderly transition of both the Medicare and Medicaid lines of business. As a result of Centene, our health plan business will be down year-over-year as we continue to focus on pricing discipline for both prospective customers and renewing our in-force customers. As I look at 2024 net new business and the pipeline, it’s definitely weighted more towards the employer business this year, and we’ve had a particularly strong year in the national employer accounts as we won close to 60% of the clients that have changed PBMs for ’24.
We’ve seen success with enterprise accounts as well, where we share common customers with Aetna. We continue to believe we offer the best PBM operating model in both cost of goods and service levels in the industry, and are confident in our long range growth outlook as we wrap up the 2024 selling season and turn our focus towards growing in 2025 and beyond. Finally, I would just suggest we continue to focus on leveraging our full suite of CVS Health assets, including the most recent value-based care acquisitions of both Signify and Oak Street, as we continue to offer a differentiated value prop in the multi-payor marketplace.
Karen Lynch: [Indiscernible] talk about the biosimilars [indiscernible], another one of her questions.
David Joyner: Sure, it was a multi-faceted question. Let me just add on the biosimilars, because we obviously have not announced our position for the coming year. But that said, we’ve had a very thoughtful and planned approach to the Humira biosimilar launch, and it’s been planned for several years now, so as a result, our customers have already benefited from the competition and with the much lower spend in the category. As we prepared for the formulary launch, we’re committed to the same lowest net cost strategy that we employ across our formulary and will be using the additional competition to create even more value for our customers and members. I’d like to offer two additional points. The first is we have a unique track record in the biosimilar-like market, so as you recall several years ago, where we removed Lantus from our formulary and added a lower list price biosimilar-like product, called Basaglar, we were able to convert 97% of the volume and delivered more than 21% savings to our customers.
While we haven’t announced our formulary strategy yet, we took a similar approach in the hep-C category by announcing last and was also able to deliver the lowest net cost and the most innovative solution for our customers. Not only will we continue to provide our clients and members optionality, we’re also ensuring that we’re providing the lowest net cost options and that our selective strategy helps our clients truly realize the savings. Bottom line, and this speaks to the broader biosimilar marketplace, we’re committed to establishing a viable and durable biosimilar market and believe we’re well positioned to deliver innovation in the AI class, and we look forward to providing more clarity around Humira in the coming weeks.
Lisa Gill: Great, thank you so much.
Operator: Our next question comes from Michael Cherny from Bank of America. Michael, your line is now open. Please go ahead.
