Why a CVS breakup may be hard to execute: 3 notes

CVS Health is contemplating a breakup of its diversified operations after a tumultuous financial period marked by repeated forecast cuts and a significant drop in stock value, The Wall Street Journal reported Oct. 1. 

Advertisement
  1. The company has invested more than $88 billion in acquisitions over the last six years, with the aim to transform from a traditional retail pharmacy into a comprehensive retail provider. However, analysts told the news outlet that separating the integrated units could bring certain challenges. 
  2. CVS’ board is conducting a strategic review, exploring options that include a split. However, the decision is not expected in the near term, and analysts said dismantling the organization could leave certain units struggling independently, which could jeopardize customer retention and revenue streams. 
  3. While a breakup could allow for a renewed focus on core operations, it also raises concerns about a disruption of synergies between CVS pharmacy services and its pharmacy benefit manager, CVS Caremark, according to the Journal

At the Becker's 11th Annual IT + Revenue Cycle Conference: The Future of AI & Digital Health, taking place September 14–17 in Chicago, healthcare executives and digital leaders from across the country will come together to explore how AI, interoperability, cybersecurity, and revenue cycle innovation are transforming care delivery, strengthening financial performance, and driving the next era of digital health. Apply for complimentary registration now.

Register to Attend Webinar

The Performance Gap Your Pharmacy Training Metrics Can’t See

Monday, August 10
12:00 PM - 1:00 PM CDT

Presenters: Michael Alexander, AudirieDr. Tina Moen, PharmD, Colibri Healthcare

Advertisement

Next Up in Pharmacy

Advertisement

Comments are closed.