NEW YORK – CVS Health (NYSE: CVS) is exiting its core infusion services business and plans to either close or sell 29 related regional pharmacies in the coming months, a company spokesperson confirmed to Reuters on Friday.
Details of the strategic shift were announced in a CVS corporate memo dated October 8 and seen by Reuters.
On October 8, the company stopped taking new patients seeking antibiotics, drugs supporting muscular health, and intravenous nutrition services, Shelly Bendit, a senior manager of corporate communications, told Reuters.
CVS Health (NYSE: CVS) bought Coram LLC, a drug infusion services provider, for $2.1 billion in 2013.
“Providers of infused medications have continued to face a challenging environment for their most highly specialized, complex services, and Coram has not been immune to these challenges,” Bendit added.
It will continue to provide specialty medications and enteral nutrition, or tube feeding, at pharmacies in Minnesota, Pennsylvania, and San Diego, and provide nursing services nationwide.
She said the company has not yet announced any workforce reductions and that any impacted employees would be notified in mid-November with the roles ending in January.
Patients still relying on the targeted therapies will be transferred to other infusion providers, Bendit said.
The move isn’t related to the company’s plan to cut 2,900 corporate jobs.
“We plan to close 29 regional pharmacies over the coming months, but are also exploring a possible sale of these assets,” Bendit said.
Reuters reported in September that CVS is exploring a split between its insurance and retail businesses, amid active investor scrutiny. Expecting higher medical costs during the second half of 2024, the company slashed its earnings forecast in August.
Coram provides on-site infusions, and in-home therapies, according to Bendit. Coram’s Rhode Island location will also remain open, she said.
CVS Health (NYSE: CVS) shares were flat at $66.91 on Friday afternoon.
(Source: Reuters)
Maria Reed is a financial journalist with a passion for covering US equities. She joined the ABBO News team in June 2023. Maria holds an M.S. degree in International Economics and Finance from Otto-von-Guericke University in Magdeburg and is a CFA Level 2 candidate.
