CVS Changes Name and Ends Tobacco Sales

CVS on Wednesday changed its name to CVS Health and stopped selling tobacco products.

“Health is everything and CVS Health is changing the way health care is delivered to increase access, lower costs and improve quality,” said company CEO Larry Merlo in a statement.

CVS Health, formerly known as CVS Caremark, is the first national pharmacy chain to halt the sale of tobacco and related products. The removal of those items comes a month earlier than planned.

“By eliminating cigarettes and tobacco products from sale in our stores, we can make a difference in the health of all Americans,” Merlo said.

Forbes reported the change will cost CVS about $2 billion a year. Tobacco sales made up about 3 percent of the company’s revenue. Merlo told Forbes the decision will spur new business to make up for the lost sales. CVS operates about 7,700 retail pharmacies.

At the same time, this is seen as a strategic move to challenge the nation’s dominant pharmacy chain, Illinois-based Walgreen Co.

“What this says about CVS is that we’re a pharmacy innovation company that is at the forefront of a changing healthcare landscape, and it helps us to play a bigger role in health care,” Merlo said.

CVS has been seeking partnerships with health systems and doctors to manage the health care of groups of patients. Such arrangements call into question the contradiction inherent in selling tobacco and delivering health care.

Dr. Troy Brennan, CVS chief medical officer, told the Chicago Tribune that potential medical partners expect everyone to share in the effort to reduce healthcare costs. Operating a business in which someone can pick up prescriptions and cigarettes is an unfortunate irony.