Why CVS Thinks It Can Revolutionize Health Care
CVS is more than just a drugstore chain. Four years after adding “Health” to its name, CVS Health enters perhaps the most pivotal moment in its 55-year history as it takes on emerging competitors like Amazon and Apple.
CVS wants to be a health-care company. CVS closed on its $70 billion purchase of health insurer Aetna on Nov. 28 after Aetna sold off some assets to win antitrust approval from the Justice Department. Although it still needs court approval and could be pared back, the deal is considered so transformative that CEO Larry Merlo says it will change the way health care is delivered in the United States. It will also make CVS Health one of the nation’s largest health-care companies.
It’s a long way away from where the Woonsocket, Rhode Island-based company started.
Brothers Stanley and Sidney Goldstein, along with partner Ralph Hoagland, opened the first Consumer Value Stores in Lowell, Massachusetts, in 1963. That store sold health and beauty products — but not prescription drugs.
They bought their first pharmacies in 1967, the first of many acquisitions that would build CVS into what it is today. Over the decades, CVS has scooped up small independent pharmacies and regional chains, bringing it into competition with pharmacy chains like Walgreens and Rite Aid.
All of those deals established CVS as a national retailer. Its 2006 acquisition of a Minnesota chain of walk-in clinics, called MinuteClinic, showed CVS had other ambitions. One year later, in 2007, CVS bought pharmacy benefit manager Caremark for $26.5 billion.
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Why CVS Thinks It Can Revolutionize Healthcare