who-owns-cvs

Who Owns CVS?

CVS is primarily owned by institutional investors like The Vanguard Group (8.28%) and BlackRock (7.1%). Followed by individual investors like Larry Merlo (former president and CEO), Jonathan Roberts (former chief operating officer), Karen Lynch (Chief Executive Officer), Eva Boratto (Chief Financial Officer), and Troyen Brennan (former Executive Vice President and Chief Medical Officer).

AspectDescriptionAnalysisExamples
Products and ServicesCVS Health offers a range of healthcare services and products. These include retail pharmacy services, prescription medications, over-the-counter drugs, health and wellness products, and pharmacy benefit management (PBM) services. The company operates a network of retail pharmacy stores and MinuteClinic walk-in clinics, providing primary care and wellness services. CVS Health also offers prescription mail-order services and specialty pharmacy services.CVS Health’s offerings encompass retail pharmacy services, prescription medications, over-the-counter drugs, health and wellness products, and PBM services. The combination of retail stores, MinuteClinics, mail-order services, and specialty pharmacies creates a comprehensive healthcare ecosystem. CVS Health serves as both a retail and healthcare destination.Retail pharmacy services, prescription medications, over-the-counter drugs, health and wellness products, PBM services, MinuteClinic walk-in clinics for primary care and wellness, prescription mail-order services, specialty pharmacy services, a comprehensive healthcare ecosystem, retail and healthcare destination.
Revenue StreamsCVS Health generates revenue from various sources. The primary revenue stream comes from the sale of prescription medications, over-the-counter drugs, and health and wellness products through its retail pharmacy stores. Additionally, the company earns income from PBM services, which involve negotiating drug prices and managing prescription benefits for health plans and employers. CVS Health also generates revenue from MinuteClinic services and specialty pharmacy services.The main sources of revenue for CVS Health include the sale of prescription and over-the-counter drugs, health and wellness products, and services through its retail stores. PBM services contribute significant income, involving price negotiations and prescription benefit management. MinuteClinic services and specialty pharmacy services serve as additional revenue streams. CVS Health’s diversified revenue sources provide financial stability.Revenue from the sale of prescription and over-the-counter drugs, health and wellness products, and services through retail stores, income from PBM services through price negotiations and prescription benefit management, revenue generated from MinuteClinic services and specialty pharmacy services, diversified revenue sources ensuring financial stability.
Customer SegmentsCVS Health serves a diverse customer base that includes patients, healthcare providers, health plans, employers, and individuals seeking health and wellness products and services. Patients and individuals access retail pharmacy services, prescription medications, and over-the-counter drugs. Healthcare providers and health plans utilize PBM services for drug cost management. Employers offer CVS Health services as part of employee health benefits.Customer segments for CVS Health encompass patients and individuals seeking retail pharmacy services, prescription medications, and over-the-counter drugs. Healthcare providers and health plans use PBM services for drug cost management. Employers include CVS Health services in employee health benefits. CVS Health caters to a wide range of healthcare stakeholders and individuals looking for health and wellness solutions.Patients, individuals seeking retail pharmacy services, prescription medications, and over-the-counter drugs, healthcare providers, health plans utilizing PBM services for drug cost management, employers incorporating CVS Health services into employee health benefits, diverse customer base spanning healthcare stakeholders and individuals seeking health and wellness solutions.
Distribution ChannelsCVS Health operates through a network of retail pharmacy stores, which serve as physical points of service for prescription medications, over-the-counter drugs, and health and wellness products. MinuteClinic walk-in clinics provide primary care and wellness services. The company also offers prescription mail-order services and specialty pharmacy services. CVS Health’s digital platform and mobile apps allow customers to manage prescriptions, access health information, and order products online.Distribution channels for CVS Health encompass a network of retail pharmacy stores, serving as physical service points for prescription medications, over-the-counter drugs, and health and wellness products. MinuteClinic walk-in clinics offer primary care and wellness services. Prescription mail-order and specialty pharmacy services provide additional accessibility. The digital platform and mobile apps enhance convenience, enabling prescription management and online product orders.Retail pharmacy stores as physical service points, MinuteClinic walk-in clinics for primary care and wellness, prescription mail-order and specialty pharmacy services providing accessibility, digital platform and mobile apps for prescription management and online product orders, comprehensive multi-channel approach for customer convenience.
Key PartnershipsCVS Health collaborates with various partners to strengthen its healthcare offerings. These partnerships may involve pharmaceutical manufacturers and wholesalers for sourcing medications, health plans and employers for PBM services, healthcare providers for clinic operations, and health and wellness product suppliers. CVS Health also engages with technology companies to enhance digital health solutions.Collaborations with pharmaceutical manufacturers, wholesalers, health plans, employers, healthcare providers, and health and wellness product suppliers bolster CVS Health’s healthcare offerings. Partnerships with technology companies contribute to the advancement of digital health solutions. CVS Health’s partnerships enrich its healthcare ecosystem.Collaborations with pharmaceutical manufacturers and wholesalers for medication sourcing, health plans and employers for PBM services, healthcare providers for clinic operations, health and wellness product suppliers, technology companies for advancing digital health solutions, contributions to a comprehensive healthcare ecosystem.
Key ResourcesCVS Health’s key resources include its extensive network of retail pharmacy stores, healthcare professionals and staff, technology infrastructure, pharmacy benefit management capabilities, partnerships with pharmaceutical manufacturers and suppliers, and its brand reputation as a trusted healthcare provider. The company’s digital platform and mobile apps also play a significant role in customer engagement and prescription management.Key resources for CVS Health encompass its vast network of retail pharmacy stores, a dedicated team of healthcare professionals and staff, technology infrastructure, PBM capabilities, partnerships with pharmaceutical manufacturers and suppliers, and a trusted brand reputation as a healthcare provider. The digital platform and mobile apps facilitate customer engagement and prescription management. CVS Health’s resources support its healthcare services.Extensive network of retail pharmacy stores, healthcare professionals and staff, technology infrastructure, PBM capabilities, partnerships with pharmaceutical manufacturers and suppliers, trusted brand reputation as a healthcare provider, digital platform and mobile apps for customer engagement and prescription management, resources supporting healthcare services.
Cost StructureCVS Health incurs costs related to the operation of its retail pharmacy stores, including rent, utilities, and employee salaries. Pharmaceutical procurement and inventory management expenses involve the sourcing and distribution of medications. Additionally, CVS Health invests in technology infrastructure and digital platforms. Costs also include employee benefits, marketing and promotional campaigns, and healthcare service delivery.Costs associated with CVS Health’s operations include rent and utilities for retail pharmacy stores, employee salaries, pharmaceutical procurement, inventory management expenses, technology infrastructure maintenance, digital platform development, employee benefits, marketing and promotional initiatives, and healthcare service delivery costs. The company manages its expenses while providing healthcare services efficiently.Costs related to retail pharmacy store operations (rent, utilities, employee salaries), pharmaceutical procurement, inventory management, technology infrastructure maintenance, digital platform development, employee benefits, marketing and promotional efforts, healthcare service delivery costs, cost management while ensuring efficient healthcare service provision.
Competitive AdvantageCVS Health’s competitive advantage lies in its extensive network of retail pharmacy stores and MinuteClinic walk-in clinics, providing convenient access to healthcare services. Its pharmacy benefit management capabilities enable cost-effective prescription drug management for health plans and employers. The company’s digital platform enhances customer engagement and prescription management. CVS Health’s trusted brand and healthcare expertise reinforce its position as a comprehensive healthcare provider.CVS Health’s competitive edge originates from its widespread network of retail pharmacy stores and MinuteClinic clinics, offering convenient healthcare access. PBM capabilities enable cost-effective drug management for health plans and employers. The digital platform enhances customer engagement and prescription management. CVS Health’s trusted brand and healthcare expertise solidify its standing as a comprehensive healthcare provider.Extensive network of retail pharmacy stores and MinuteClinic clinics providing convenient healthcare access, PBM capabilities ensuring cost-effective drug management, digital platform for customer engagement and prescription management, trusted brand and healthcare expertise consolidating CVS Health’s position as a comprehensive healthcare provider.

Ownership Structure of CVS:

  • Institutional Investors: The Vanguard Group owns 8.28% of CVS shares, and BlackRock owns 7.1%.
  • Key Executives: Former President and CEO Larry Merlo, former Chief Operating Officer Jonathan Roberts, CEO Karen Lynch, CFO Eva Boratto, and former EVP and Chief Medical Officer Troyen Brennan are individual investors with ownership stakes in CVS.

Business Model of CVS:

  • Retail Pharmacy: CVS operates a chain of retail pharmacies offering prescription medications, over-the-counter drugs, health and beauty products, and convenience items.
  • Pharmacy Benefit Management (PBM): Through its subsidiary CVS Caremark, the company offers PBM services, including managing prescription drug benefits for health plans and employers.
  • Healthcare Services: CVS provides various healthcare services such as walk-in medical clinics (MinuteClinic), specialty pharmacy services, and home infusion services.
  • Long-Term Care: CVS operates long-term care pharmacies and provides prescription services to nursing homes and assisted living facilities.
  • Digital Health: The company leverages digital health technologies and platforms to offer telemedicine services and health-related mobile apps.

Organizational Structure of CVS:

  • CEO: Karen Lynch is the Chief Executive Officer of CVS Health.
  • CFO: Eva Boratto serves as the Chief Financial Officer.
  • COO: Jonathan Roberts was the former Chief Operating Officer.
  • CMO: Troyen Brennan was the former Executive Vice President and Chief Medical Officer.

Key Takeaways for CVS:

  • Diversified Business Portfolio: CVS has a diverse business model, encompassing retail pharmacy, PBM services, healthcare, and digital health initiatives. This diversification helps mitigate risks and capture opportunities in different segments of the healthcare industry.
  • Pharmacy Benefit Management: The PBM division (CVS Caremark) is a significant contributor to CVS’s revenue. It manages prescription drug benefits for a wide range of clients, including health plans and employers.
  • Vertical Integration: CVS’s acquisition of Aetna, a health insurance company, reflects its strategic approach to vertical integration. This move allows CVS to offer more comprehensive healthcare solutions and better coordinate care for customers.
  • Retail Presence and Convenience: CVS’s extensive network of retail pharmacies and MinuteClinics provides convenient access to healthcare services and products for customers, driving foot traffic and enhancing customer loyalty.
  • Digital Transformation: CVS is investing in digital health technologies and telemedicine services to enhance customer engagement and improve healthcare accessibility, especially in the wake of the COVID-19 pandemic.
  • Regulatory and Competitive Environment: The healthcare industry is subject to complex regulations and competitive pressures. CVS must navigate changes in healthcare policies and maintain competitiveness against rivals like Walgreens and Walmart.
  • Leadership Transition: With a new CEO, Karen Lynch, at the helm, CVS is undergoing a leadership transition. Successful leadership and strategic execution will be crucial for the company’s continued growth and success.
  • Healthcare Innovation: CVS’s focus on healthcare innovation, including digital health solutions and personalized care, positions it to adapt to evolving consumer needs and industry trends.
  • Community Impact: CVS’s initiatives in promoting health and wellness, charitable giving, and sustainability efforts contribute to its positive corporate image and community impact.
  • Customer-Centric Approach: CVS aims to enhance customer experience and loyalty through personalized health services and tailored solutions that address individual healthcare needs.

CVS vs. Walgreens

CVS is the largest group in the US, which primarily competes with other groups like the Walgreens Boots Alliance, a conglomerate in the retail health space, which owns Walgreens, Boots in the UK, and a few more brands.

For some context, in 2022, CVS generated over $322 billion in revenue, vs. Walgreens Boots Alliance’s $268 billion in revenue.

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CVS had 9,674 stores in 2022, compared to 9,939 stores in 2021.

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CVS had 9,674 stores in 2022, compared to 9,939 stores in 2021, and 9,962 stores in 2020.

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CVS Revenue

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CVS generated over $322 billion in revenue in 2022, compared to over $292 billion in 2021 and over $268 billion in 2020. In 2022, of CVS’s revenue, most of it came from products, followed by premiums and services.

CVS Profits

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CVS generated $4.15 billion in profits in 2022, compared to $7.91 billion in 2021 and $7.18 billion in 2020.

CVS Revenue Breakdown

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CVS Distribution Strategy

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CVS’s distribution strategy is toward pharmacy, which in 2022 generated nearly 77% of the company’s revenue compared to front store & others, which generated over 23% of its revenue.

CVS Revenue By Channel

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In 2022, CVS generated most of its revenue from pharmacy (76.9%), compared to 76% of revenue from pharmacy in 2021 and 76.9% in 2020. The rest is generated by retail & others.

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