News
James B. Bell
- August 18, 2023
CVS Health stock experienced a decline on Thursday due to a report indicating that a major health insurer will transition away from CVS's pharmacy-benefit management service and instead opt for a system that is partially operated by Amazon.com.
In this move, Blue Shield of California has decided to drop CVS's current pharmacy-benefit manager, Caremark. The insurer will replace it with a selection of other companies, including the incorporation of at-home drug delivery services from Amazon.
However, CVS will still hold the responsibility of handling specialty drugs for Blue Shield of California's members.
Upon receiving this news, CVS shares fell by 5% during premarket trading on Thursday. At the time of reporting, CVS had not provided a comment in response to an early request from The Wall Street Journal.
According to Blue Shield, this change could potentially save the company around $500 million annually. The full launch of the new offering is set for 2025 and will undergo a limited rollout next year.
CVS's concerns over Amazon's increasing presence in the healthcare industry have been growing, especially as the two companies have clashed in previous attempts to acquire health-services providers.
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