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Cigna enters outcomes-based pricing program with drugmaker

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Health insurer Cigna Corp. and drugmaker Novartis A.G. have entered an outcomes-based contract for Novartis' heart failure drug Entresto, Cigna announced Monday.

Under the contract, Bloomfield, Connecticut-based Cigna will pay Basel, Switzerland-based Novartis for how well the drug performs rather than paying per pill administered, according to Cigna's statement.

Performance will be evaluated based on the reduction in the number of customers with heart failure hospitalizations, Cigna said in the statement.

Entresto is used to treat heart failure with reduced ejection fraction, which, according to the American Heart Association, is the measurement of how much blood the left ventricle pumps from the heart with each contraction.

Entresto was approved by the U.S. Food and Drug Administration in July. According to Reuters, the drug costs about $12.50 per day or $4,560 per year.

“Competitive drug prices are important, but equally so is ensuring that customers' medications are actually working as, or better than, expected,” Christopher Bradbury, senior vice president of integrated clinical and specialty drug solutions for Cigna Pharmacy Management, said in the statement. “Outcomes-based contracts require that prescription medicines perform in the real world at least as well as they did during clinical trials and are a valuable tool for improving health and managing costs. When pharmaceutical companies stand behind the performance of their drugs through these kinds of contracts, we can deliver the most value to Cigna's customers and clients for the money they are spending.”