CVS said it would buy Target’s pharmacy and clinic business for nearly $2 billion on Monday in a deal healthcare advocates warn is part of a growing trend that is bad for patients.
CVS said it will acquire more than 1,660 pharmacies across 47 states and will operate them through a store-within-a-store format, kind of like the Starbucks you see in some big box stores.
In addition, CVS plans to include pharmacies in all new Target stores that offer pharmacy services.
Target has nearly 80 clinic locations that will be rebranded under CVS’ MinuteClinics. CVS said it also plans to open up 20 new clinics in Target stores within three years after the deal is closed.
CVS and Target also are working to create about five to 10 smaller stores called TargetExpress that will include CVS pharmacies.
The deal needs regulatory clearance.
It is not clear how the deal will affect insurance coverage of patients’ drugs. CVS and Target did not immediately return requests for comment as to whether CVS will honor the same insurance plans as Target.
CVS said the changes would be rolled out over the several months after the deal closes. The company said it is committed to giving the Target employees comparable positions with CVS.
Healthcare advocates were worried about what the deal means in terms of access for patients, as consolidation in the retail setting means pharmacies are “increasingly available only from a fewer number of larger entities,” according to a statement from the National Community Pharmacists Association.
