CVS Caremark Corporation (CVS) Halts Tobacco Sale and Modifies Name

CVS Caremark Corporation (NYSE:CVS), one of the leading drugstores, had announced in February this year that it would stop cigarette sales in its stores October, but has pulled a surprise by directing a withdrawal a month before the scheduled date. The company is also said to be making a change to its name in a strategy to refine its corporate identity.

Forbes Magazine revealed that the decision to remove cigarettes and to change its name from CVS Caremark Corporation (NYSE:CVS) to CVS Health (NYSE:CVS) is in line with its wider plan to focus more on the betterment of healthcare and to transform the future health of the American people. This will affect all its more than 7,700 stores spread across North America.

CVS Caremark Corporation (CVS)

“The sale of tobacco in a retail pharmacy conflicts with the purpose of he health care services delivered there,” said Dr. Troyen Brennan, chief medical officer at CVS Health (NYSE:CVS). “Even more important, there is evidence developing that indicates that removing tobacco products from retailers with pharmacies will lead to substantially lower rates of smoking with implications for reducing tobacco-related deaths.”

New York Times in an article said that the move by CVS Caremark Corporation (NYSE:CVS) could prove very lucrative and is believed to be a leeway for greater partnerships with other entities within the health sector. The health sector has registered growth in the recent past, and a move to focus purely on the improvement of health is timely.

“CVS is really trying very hard to position themselves as the winner in that marketplace,” said Skip Snow, a health care analyst at Forrester Research. “If they can be perceived as a place to go to receive health care, and buy health care products, as opposed to the place to go to buy a bottle of whiskey or get your film developed, then they can capture more of the retail medicine dollars.”

In the recent years, CVS Caremark Corporation (NYSE:CVS) has focused more on customer healthcare by building several walk-in clinics and expanding the range of services they provide. The company has introduced flu shots, vaccinations, and has also been helping patients monitor diabetes, blood pressure, and other chronic conditions.

CNBC said that the bigger focus on healthcare could also be to serve the aging and the many uninsured Americans.

This article has been written by victor Ochieng.


Warren Buffett's Best Picks

Warren Buffett's these stock picks will crush the market over the next 12 months. Get our report FREE by becoming a member now