CVS Health moves to split its $117bn healthcare business into two listed companies

In brief

• CVS Health is reportedly considering splitting into two publicly traded companies by 2028, one for retail pharmacy and one for insurance.
• The reports cite the Financial Times and follow earlier reports of a possible separation of the retail pharmacy and insurance businesses.
• The move comes amid growing political scrutiny of pharmacy benefit managers and health insurers.

Reported plan to separate retail pharmacy from insurance

The Financial Times reported that CVS Health is considering splitting its business into two publicly traded companies by 2028 (CVS Health to split into two publicly traded companies by 2028, FT reports – Investing.com). Earlier reports said the group was exploring a separation of its retail pharmacy operations from its insurance business (CVS Health explores splitting retail pharmacy, insurance businesses, FT reports – Investing.com). The group is valued at $117bn (CVS Health moves to dismantle $117bn healthcare empire – Financial Times).

Political pressure on pharmacy benefit managers

The potential spin-off of the drugstore business comes as lawmakers and regulators increase scrutiny of pharmacy benefit managers and health insurers. These intermediaries negotiate drug prices and manage prescription coverage for employers and insurers. Their role has drawn criticism over drug costs for patients.

What the split would involve

Under the reported plan, CVS would be left with two independent listed companies, one built around its retail pharmacies and one around its insurance operations. The company has not publicly confirmed the plan. Details on how the separation would be structured, including the timing of individual steps and the division of assets and debt, have not been disclosed.