CVS Pharmacy

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CVS Pharmacy
TypeSubsidiary of CVS Caremark Corporation
IndustryRetail
FoundedLowell, Massachusetts, U.S. (May 8, 1963 (1963-05-08))
Founder(s)Stanley and Sidney Goldstein
Ralph Hoagland
HeadquartersWoonsocket, Rhode Island, U.S.
Number of locations7,600 CVS/pharmacy® retail stores (2014)[1]
Area servedNationwide
RevenueIncrease US$55.663 billion (2009)[dated info]
Operating incomeIncrease US$2.019 billion (2009)[dated info]
Net incomeIncrease US$1.660 billion (2009)[dated info]
Employees80,000 (2005)[dated info]
ParentCVS Caremark Corporation
Websitecvs.com
 
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CVS Pharmacy
TypeSubsidiary of CVS Caremark Corporation
IndustryRetail
FoundedLowell, Massachusetts, U.S. (May 8, 1963 (1963-05-08))
Founder(s)Stanley and Sidney Goldstein
Ralph Hoagland
HeadquartersWoonsocket, Rhode Island, U.S.
Number of locations7,600 CVS/pharmacy® retail stores (2014)[1]
Area servedNationwide
RevenueIncrease US$55.663 billion (2009)[dated info]
Operating incomeIncrease US$2.019 billion (2009)[dated info]
Net incomeIncrease US$1.660 billion (2009)[dated info]
Employees80,000 (2005)[dated info]
ParentCVS Caremark Corporation
Websitecvs.com

CVS Pharmacy (styled as CVS/pharmacy or simply CVS) is the largest pharmacy chain in the United States,[2] with more than 7,600 stores,[3] and is the second largest US pharmacy based on total prescription revenue.[4] As the retail pharmacy division of CVS Caremark, it ranks as the 13th largest company in the world according to Fortune 500 in 2013.[5] CVS Pharmacy's leading competitor Walgreens ranked 37th.

CVS sells prescription drugs and a wide assortment of general merchandise, including over-the-counter drugs, beauty products and cosmetics, film and photo finishing services, seasonal merchandise, greeting cards, and convenience foods through their CVS Pharmacy and Longs Drugs retail stores and online through CVS.com. It also provides healthcare services through its more than 600 MinuteClinic medical clinics [6] as well as their Diabetes Care Centers. Most of these clinics are located within CVS stores.

CVS is incorporated in Delaware, and is based in Woonsocket, Rhode Island.[7] As of 2008, CVS Caremark was the largest for-profit employer in Rhode Island.[7] It was founded on Merrimack Street in Lowell, Massachusetts, in 1963, under the name Consumer Value Store.[8] It was founded by Sid Goldstein, Stanley Goldstein, and Ralph Hoagland, as a discount health and beauty aid store. The first customers were required to bag their own purchases.[9]

Overview[edit]

A newer CVS Pharmacy storefront in St. Louis, Missouri.

CVS Pharmacy used to be a subsidiary of Melville Corporation, where its full name was initially Consumer Value Stores. Melville later changed its name to CVS Corporation in 1996[9][10] after Melville sold off many of its non-pharmacy stores.[11] The last of its non-drugstore operations were sold in 1997.[9]

Former CEO Tom Ryan has said he now considers "CVS" to stand for "Customer, Value, and Service".[12]

During the company's days as a regional chain in the Northeast, many CVS stores did not include pharmacies. Today the company seldom builds new stores without pharmacies and outside of New England is gradually phasing out any such shops. Any new non-pharmacy store is usually built in a more urban setting where another CVS with a pharmacy exists within walking distance such as downtown Boston or Providence. These stores usually lack a pharmacy and a photo center but carry most of the general merchandise items that a normal CVS Pharmacy carries such as health and beauty items, sundries, and food items.

Acquisitions and growth[edit]

A CVS Pharmacy (Store #6240) in Southside Place, Texas (Greater Houston) that was formerly an Eckerd.
A CVS Pharmacy, in Durham, North Carolina.

1960s[edit]

The CVS name was used for the first time in 1964. That year, they had 17 retail locations, and 40 stores only five years later.[13]

In 1967, CVS began operation of its first stores with pharmacy departments, opening locations in Warwick and Cumberland, Rhode Island. CVS was acquired by the now-defunct Melville Corporation in 1969, boosting its growth.

1970s[edit]

In 1972, CVS acquired 84 Clinton Drug and Discount stores, which introduced CVS to Indiana and the Midwest. By 1974, CVS had 232 stores and sales of $100 million. In 1977, CVS acquired the 36-store New Jersey-based Mack Drug chain.[13]

By 1970, CVS operated 100 stores in New England and the Northeast.

1980s[edit]

The chain had more than 400 stores by 1981. Sales reached $1 billion in 1985, partly due to the pharmacies being added to many of CVS's older stores.[13]

In 1980, CVS became the 15th largest pharmacy chain in the U.S. with 408 stores and $414 million in sales. In 1988, CVS celebrated its 25th anniversary, finishing the year with nearly 750 stores and sales of about $1.6 billion.

1990s[edit]

In 1990, CVS acquired the 490-store Peoples Drug chain from Imsco, which established the company in new mid-Atlantic markets including Washington, D.C., Pennsylvania, Maryland, and Virginia. In 1994, CVS started PharmaCare Management Services. The parent company decided to focus on CVS in 1995, selling off Marshalls and This End Up. The following year, they let go of Footaction/Footstar, Meldisco, Linens 'n' Things, and Kay-Bee Toys, and the company changed its name from Melville Corporation to CVS Corporation. In 1997, Bob's Stores were also sold, and CVS nearly tripled its 1,400 stores after purchasing the 2,500-store Revco chain. CVS bought 200 Arbor Drugs locations in 1998, opened approximately 180 new stores, closed about 160 stores, and relocated nearly 200 existing stores from strip malls to freestanding locations. In 1999, CVS acquired Soma.com, the first online pharmacy, and renamed it CVS.com. The same year, CVS launched their CVS ProCare Pharmacy for complex drug therapies.[13]

In 1990, CVS bought the 23-store Rix Dunnington chain. In 1993, CVS withdrew from the southern California market. Formerly traded as MVL on the New York Stock Exchange, the company now trades as CVS.

2000s[edit]

CVS bought Stadtlander Pharmacy of Pittsburgh from Bergen Brunswig/AmerisourceBergen in 2000.[13][14] As of December 2009, CVS Caremark had over 7,000 locations.[15]

Alternative logo of CVS Pharmacy

2010s[edit]

In 2012, CVS Caremark received 59 percent of Rhode Island's tax credits.[24]

Online[edit]

The domain cvs.com attracted at least 26 million visitors annually by 2008 according to a Compete.com survey.[25]

CVS no longer owns the soma.com domain name, which it acquired with the purchase of online drugstore pioneer Soma. The domain name now belongs to a lingerie retailer.

CVS uses online training methods to train most of their employees and uses the website cvslearnet.cvs.com.

By 2004, all CVS stores were able to receive electronic prescriptions.[26]

Environmental record[edit]

In 2005, CVS participated in a program to reduce the pollution of Maine's waterways. CVS agreed to accept drugs for disposal, so that people would not dispose of them in ways that reach rivers and other bodies of waters.[27][28][29]

In 2013, CVS agreed to pay Connecticut $800,000 due to alleged mismanagement of hazardous waste. The Connecticut Department of Energy and Environmental Protection agency found that CVS had improperly identified, managed, and disposed of hazardous materials.[30]

Controversies[edit]

A CVS location (#7606) in Austin, Texas, across from the University of Texas at Austin

$2.25 million HIPAA Privacy Case[edit]

CVS was required to pay the United States government $2.25 million in 2009 for violations of the Health Insurance Portability and Accountability Act of 1996 (HIPAA) Privacy Rule. The U.S. Department of Health and Human Services Office for Civil Rights (OCR) and the Federal Trade Commission (FTC) found that CVS did not appropriately dispose of sensitive patient information or provide the necessary training on disposal to their employees.[31]

Executives accused of bribing state senator[edit]

Former CVS executives John R. Kramer and Carlos Ortiz were charged with bribery, conspiracy, and fraud (including mail fraud) by a federal grand jury for allegedly paying State Senator John A. Celona (D-RI) to act as a "consultant" for the company. Between February 2000 and September 2003, CVS paid Celona $1,000 a month, and he received tickets to golf outings and sporting events and compensation for travel to Florida and California. In August 2005, he pleaded guilty to mail fraud charges, and in January 2007, he was fined a record $130,000 by the Rhode Island Ethics Committee. The investigation was led by the FBI and the Rhode Island State Police, and the case was prosecuted by Assistant U.S. Attorneys Gerard B. Sullivan and Dulce Donovan. Additional information is available in a press release from the FBI's Boston field office.[32]

Prescription errors[edit]

During 2005, a rash of prescription mistakes came to light in some of CVS Corporation's Boston-area stores. An investigation confirmed 62 errors or quality problems going back to 2002. In February 2006, the state Board of Pharmacy announced that the non-profit Institute of Safe Medication Practices (ISMP) would monitor all Massachusetts stores for the next two years.[33] Later, a 2007 segment on 20/20 accused CVS, Walgreens and Rite Aid among other pharmacies, of making various prescription dispensing errors. This segment aired in March 2007 and was called "ABC News '20/20' Undercover Pharmacy Investigation". CVS responded by claiming they have designed and invested millions of dollars in a comprehensive quality assurance program.[34]

Texas lawsuit over illegally dumping patient information[edit]

Texas Attorney General Greg Abbott sued CVS in April 2007, for illegally dumping confidential patient information while closing an acquired Eckerd store in Liberty, Texas. CVS is accused of breaking the 2005 Identity Theft Enforcement and Protection Act. There are also other possible violations under the violations under Chapter 35 of the Business and Commerce Code.[35] CVS settled by paying $315,000 to the state and agreeing to overhaul its information security system.[36]

Cigarette sales[edit]

In common with other US pharmacies, CVS stocks cigarettes for sale to the public. Some campaigners in the USA advocate the removal of tobacco from pharmacies due to the health risks associated with smoking and the apparent contradiction of selling cigarettes alongside smoking cessation products and asthma medication.[37] CVS and other pharmacies who continue to sell tobacco products have been subject to criticism, and attempts have been made to introduce regional bans on the practice, notably by the City and County of San Francisco.[38][39]

In 2007, CEO Thomas Ryan stated that the company was considering halting the sale of cigarettes within its pharmacies, acknowledging that the issue was problematic for the company, but has not done so, citing internal market research that discovered ceasing cigarette sales will not change consumer behaviour (of buying cigarettes).[40]

In February 2014, CVS announced that it will stop selling cigarettes and other tobacco products at its stores, challenging other retailers to follow its lead. The decision means the company will forfeit $1.5 billion a year in tobacco revenue.[41]

Deceptive business practices[edit]

In February 2008, CVS settled a large civil lawsuit for deceptive business practices. The Kaiser Family Foundation reported:[42]

CVS Caremark has agreed to a $38.5 million settlement in a multi-state civil deceptive-practices lawsuit against pharmacy benefit manager Caremark filed by 28 attorneys general, the Chicago Tribune reports.[43] The attorneys general, led by Lisa Madigan (D) of Illinois and Douglas Ganslar (D) of Maryland, allege that Caremark "engaged in deceptive business practices" by informing physicians that patients or health plans could save money if patients were switched to certain brand-name prescription drugs (Miller, Chicago Tribune, 2/14).[43]

However, the switch often saved patients and health plans only small amounts or increased their costs, while increasing Caremark's profits, Connecticut Attorney General Richard Blumenthal (D) said (Levick, Hartford Courant, 2/15).[44] Pennsylvania Attorney General Tom Corbett (R) said the PBM kept discounts and rebates that should have been passed on to employers and patients (Levy, AP/San Francisco Chronicle, 2/14).[45] In addition, Caremark did not "adequately inform doctors" of the full financial effect of the switch and did not disclose that the switch would increase Caremark's profits, the lawsuit alleges (Chicago Tribune, 2/14).[43]

...The settlement prohibits Caremark from requesting prescription drug switches in certain cases, such as when the cost to the patient would be higher with the new prescription drug; when the original prescription drug's patent will expire within six months; and when patients were switched from a similar prescription drug within the previous two years (Hartford Courant, 2/15).[44] Patients also have the ability to decline a switch from the prescribed treatment to the prescription offered by the pharmacy under the settlement, Madigan said (Bloomberg News/Philadelphia Inquirer, 2/15).[45]

Methamphetamine lawsuit[edit]

A CVS location in Macomb, Illinois, formerly an Osco.

On October 14, 2010, CVS was ordered to pay $77.6 million in fines and returned profits stemming from a lawsuit alleging improper control in the sale of an ingredient used to make methamphetamine.[46] CVS will forfeit $2.6 million in profits from the illegal sale of pseudoephedrine as well as have to pay a fine of $75 million, the largest civil penalty ever paid under the Controlled Substances Act.[citation needed]

DEA investigation into oxycodone diversion[edit]

According to the US Justice Department, last year[when?] CVS pharmacies in Sanford, Florida ordered enough painkillers to supply a population eight times its size. Sanford has a population of 53,000 but the supply would support 400,000.[47] According to the Drug Enforcement Administration, in 2010 a single CVS pharmacy in Sanford ordered 1.8 million Oxycodone pills, an average of 137,994 pills a month. Other pharmacy customers in Florida averaged 5,364 oxycodone pills a month. DEA investigators serving a warrant to a CVS pharmacy in Sanford on Oct. 18 2011 noted that "approximately every third car that came through the drive-thru lane had prescriptions for oxycodone or hydrocodone". According to the DEA, a pharmacist at that location stated to investigators that "her customers often requested certain brands of oxycodone using street slang", an indicator that the drugs were being diverted and not used for legitimate pain management. In response, CVS in a statement issued Feb. 17 in response to opioid trafficking questions from USATODAY said the company is committed to working with the DEA and had taken "significant actions to ensure appropriate dispensing of painkillers in Florida".[48]

Homeless man strangled for shoplifting[edit]

On May 8, 2010, a homeless man named Anthony Kyser was strangled to death by a CVS store manager after allegedly stealing toothpaste and crayons. Surveillance footage from an alleyway near the store was captured which shows the alleged shoplifter being forced to the ground and killed by the store manager, Pedro Villanova. Though the death was ruled a homicide by the Cook County Medical Examiner's office, no charges were filed against the manager, the authorities having ruled the incident an "accident". No investigation was made into the off-duty county officer who was on scene, but did nothing to stop the attack. U.S. Rep. Bobby Rush, who spoke out in 2010 against the way Kyser's death was handled, stated "...we have video that shows emphatically that he was lying on the ground and some people strangled him, kicked him and choked him and at the end of that episode he lay still, he was killed, right there on the spot." The video shows a police officer arrived on the scene moments after the incident occurred, however, no first aid was given to the victim. Kyser's parents filed a lawsuit claiming that the CVS manager assaulted and battered their son and that the store is responsible for that manager's actions. The lawsuit, seeking $400,000 in damages, remains pending in Cook County Circuit Court.[49]

Racist receipt[edit]

In 2013, a Korean customer, Hyun Lee, was identified as "Ching Chong Lee" on her receipt from a CVS in New Jersey. Lee contacted CVS and received an email response saying that the employee would be "counseled and trained". According to Lee's attorney, "[The employee] should have been terminated immediately. She never got an apology. She never got anything further after she complained." On April 16, 2013, Lee filed a federal discrimination lawsuit against CVS and is seeking $1 million.[50]

CVS Rewards Program[edit]

In 2013, CVS introduced a program that rewarded customers up to $50 per year in ExtraCare Bucks in exchange for filling their prescriptions. In order to enroll in the program, customers had to sign a HIPAA waiver acknowledging, "my health information may potentially be re-disclosed and thus is no longer protected by the federal Privacy Rule". Stores had to fulfill a quota of a number of customers in the program each week. Walgreens and Rite Aid also offer rewards for filling prescriptions, although they do not require a signed HIPAA waiver.[51]

Homeopathy[edit]

On April 1, 2011, the James Randi Educational Foundation awarded CVS Pharmacy the tongue-in-cheek Pigasus Award for selling homeopathic remedies alongside medicines recognized by science.[52]

References[edit]

Notes

  1. ^ "CVS Caremark, Form 10-K, Annual Report, Filing Date Feb 15, 2013". secdatabase.com. Retrieved Mar 29, 2013. 
  2. ^ 2013 Top 100 Retailers. http://www.stores.org/2013/Top-100-Retailers. Retrieved on 2013-09-17.
  3. ^ Company History | CVS Caremark. Info.cvscaremark.com. Retrieved on 2013-09-05.
  4. ^ The Top 50 Retail Pharmacies, according to Drug Store News. http://www.drugchannels.net/2013/04/the-top-50-retail-pharmacies-according.html. Retrieved on 2013-09-17.
  5. ^ Fortune 500 2013: Full List - Fortune. Money.cnn.com. Retrieved on 2013-09-05.
  6. ^ http://www.delawareonline.com/article/20130217/BUSINESS13/302170017/Wal-Mart-medical-clinics-trail-CVS
  7. ^ a b WPRI - CVS to lay off 150 people in Woonsocket, 300 nationwide. WPRI.com (2010-10-28). Retrieved on 2013-09-05.
  8. ^ Lowell - Did you know? —. Lowellma.gov. Retrieved on 2013-09-05.
  9. ^ a b c History of CVS Corporation – FundingUniverse. Fundinguniverse.com. Retrieved on 2013-09-05.
  10. ^ "CVS Caremark, Form 8-K, Current Report, Filing Date Jun 7, 1996". secdatabase.com. Retrieved Mar 29, 2013. 
  11. ^ "CVS Caremark, Form 8-K, Current Report, Filing Date Dec 6, 1996". secdatabase.com. Retrieved Mar 29, 2013. 
  12. ^ Berlinski, Peter (January/February 2006). "Ryan Preaches PL to CVS Team". Private Label Magazine. Retrieved 2008-03-03. 
  13. ^ a b c d e CVS Caremark Corporation | Company profile from Hoover's | 401-765-1500. Hoovers.com (2010-10-21). Retrieved on 2013-09-05.
  14. ^ "CVS Caremark, Form 10-Q, Quarterly Report, Filing Date Nov 14, 2000". secdatabase.com. Retrieved Mar 29, 2013. 
  15. ^ "CVS Caremark, Form 10-K, Annual Report, Filing Date Feb 26, 2010". secdatabase.com. Retrieved Mar 29, 2013. 
  16. ^ "CVS Caremark, Form 8-K, Current Report, Filing Date Apr 6, 2004". secdatabase.com. Retrieved Mar 29, 2013. 
  17. ^ "CVS Caremark, Form 8-K, Current Report, Filing Date Jun 30, 2006". secdatabase.com. Retrieved Mar 29, 2013. 
  18. ^ "CVS Caremark, Form 8-K/A, Filing Date Aug 8, 2006". secdatabase.com. Retrieved Mar 29, 2013. 
  19. ^ "CVS to Postpone Shareholder Meeting to Vote on Caremark Merger" (Press release). CVS Caremark. Retrieved 2008-03-03. 
  20. ^ a b "CVS Caremark, Form 8-K, Current Report, Filing Date Mar 23, 2007". secdatabase.com. Retrieved Mar 29, 2013. 
  21. ^ "CVS Caremark, Form 8-K, Current Report, Filing Date Nov 7, 2007". secdatabase.com. Retrieved Mar 29, 2013. 
  22. ^ "CVS Caremark Successfully Completes Tender Offer for Longs Shares". MarketWatch. October 30, 2008. Retrieved November 4, 2008. 
  23. ^ "CVS Caremark, Form 8-K, Current Report, Filing Date Oct 20, 2008". secdatabase.com. Retrieved Mar 29, 2013. 
  24. ^ PolitiFact Rhode Island | Gary Sasse says 90 percent of $35 million in tax credits went to CVS and two out-of-state companies. Politifact.com. Retrieved on 2013-09-05.
  25. ^ cvs.com UVs for July 2013 | Compete. Siteanalytics.compete.com (2011-10-26). Retrieved on 2013-09-05.
  26. ^ http://www.surescripts.com/news-and-events/press-releases/2009/october/rhode-island-announces.aspx
  27. ^ "Maine's First Drug Take Back Keeps Waterways Cleaner", Environment News Service, February 9, 2005. Retrieved May 8, 2008.
  28. ^ "CVS Pharmacy Plans Drug Collection for S. Portland, Maine",NERC Email Bulletin, January 2005. Retrieved May 16, 2008.
  29. ^ "Cleaning Up Medical Waste", MSW Management, Elements 2007, Vol. 16, No. 4. Retrieved May 16, 2008
  30. ^ CVS Paying Connecticut $800,000 for Hazardous Waste Issues; Southbury Store Cited - Business - The Litchfield County Times. Countytimes.com (2013-01-29). Retrieved on 2013-09-05.
  31. ^ CVS Pays $2.25 Million and Toughens Practices to Settle HIPAA Privacy Case. Hhs.gov (2011-05-07). Retrieved on 2013-09-05.
  32. ^ "Two CVS executives are accused of paying State Senator John Celona to advance the drug company's legislative agenda" (Press release). U.S. Department of Justice. 2007-01-18. Retrieved 2008-02-25. 
  33. ^ Rowland, Christopher (2006-02-10). "CVS faces pharmacy reviews". Boston Globe. Retrieved 2008-02-25. 
  34. ^ "Drugstores Respond to '20/20'". The Blotter (ABC News). 2007-03-30. Retrieved 2008-02-25. 
  35. ^ "CVS accused of dumping Texas customers' records". AP/Dallas Morning News. 2007-04-17. Retrieved 2008-02-25. 
  36. ^ Porretto, John (March 26, 2008). "CVS, Texas settle lawsuit over dumping customers' records". Boston Globe. Retrieved 30 July 2010. 
  37. ^ "Tobacco-Free Pharmacies". Americans for Nonsmokers' Rights. Retrieved 18 July 2013. 
  38. ^ Rubenstein, Sarah (July 29, 2008). "Cigarette Sales in Drugstores Come Under Fire". The Wall Street Journal. Retrieved April 16, 2011. 
  39. ^ Hussar, PhD, Daniel A. (March 1, 2009). "Pharmacy cigarette sales must end". Modern Medicine. Retrieved April 16, 2011. 
  40. ^ Berkrot, Bill (November 14, 2007). "CVS wrestles with cigarette sales". Reuters. Retrieved April 16, 2011. 
  41. ^ Kenen, Joanne; Cheney, Kyle (February 5, 2014). "CVS to stop tobacco sales". Politico. Retrieved February 5, 2014. 
  42. ^ "CVS Caremark Agrees To Pay $38.5M To Settle Allegations That It Did Not Pass on Rebates, Discounts to Patients, Employers". Kaiser Daily Health Policy Report. Kaiser Family Foundation. 2008-02-15. Retrieved 2008-02-25. 
  43. ^ a b c Miller, James P. (2008-02-14). "CVS Caremark settles deceptive-practices complaint for $38.5 million". Chicago Tribune. Retrieved 2008-02-25. 
  44. ^ a b Levick, Diane (2008-02-15). "Caremark Settles States' Probe". Hartford Courant. Retrieved 2008-02-25. 
  45. ^ a b Levy, Marc (2008-02-14). "Caremark to pay $38M to settle drug-switching complaint". AP/San Francisco Chronicle. Archived from the original on 2008-06-11. Retrieved 2008-02-25. 
  46. ^ Ellis, Blake (14 Oct 2010). "CVS to pay $77.6 million in meth case". CNN. Retrieved 14 Oct 2010. 
  47. ^ Schoenberg, Tom (2012-02-29). "Cardinal Health Blocked From Shipping Painkiller in Florida". Bloomberg. 
  48. ^ "Most Popular E-mail Newsletter". USA Today. 2012-02-27. 
  49. ^ Huffington Post (2013) Anthony Kyser Death: Video Of Alleged CVS Shoplifter's Killing Prompts Call For New Probe. Retrieved from: http://www.huffingtonpost.com/2013/01/18/anthony-kyser-death-video_n_2506106.html
  50. ^ Valiente, Alexa. "New Jersey Woman Sues CVS for $1M for Racist Receipt". abcnews.go.com. April 18, 2013. Retrieved April 18, 2013.
  51. ^ http://www.latimes.com/business/la-fi-lazarus-20130913,0,5994820,full.column. Retrieved Sep 14, 2013
  52. ^ Mestel, Rosie (April 1, 2011). "Dr. Oz, Andrew Wakefield and others, um, 'honored' by James Randi". Los Angeles Times. Retrieved April 2, 2011. 

External links[edit]