CVS Pharmacy - Acquisitions and Growth

Acquisitions and Growth

• In 1964, CVS had 17 stores that sold primarily health and beauty products.
• 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.
• By 1970, CVS operated 100 stores in New England and the Northeast.
• In 1972, CVS nearly doubled in size with its acquisition of 84 Clinton Drug and Discount Stores. The purchase introduced CVS to the Midwest with stores in Indiana.
• In 1977, CVS acquired the 36-store New Jersey-based Mack Drug chain.
• 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.
• In 1990, CVS acquired the 500-store Peoples Drug chain, which established the company in new mid-Atlantic markets including Washington, D.C., Pennsylvania, Maryland, and Virginia. The newly acquired stores were converted to CVS stores.
• Also in 1990, CVS bought the 23-store Rix Dunnington chain.
• In 1993, CVS withdrew from the southern California market.
• Until 1996, CVS was a division of Melville Corporation. During that year, Melville divested its other subsidiary retail chains, which included Linens 'n Things, KB Toys, and Marshalls, and changed its name to CVS Corporation. Formerly traded as MVL on the New York Stock Exchange, the company now trades under the symbol CVS.
• In 1997, CVS more than doubled its 1,400 stores after purchasing the 2,500-store Revco chain. The acquisition brought CVS into the Ohio Valley and southeastern United States; previously, the company's footprint had not been south of Virginia. CVS was able to afford so large a purchase because of its recent Melville divestiture.
• In 1998, CVS acquired 207 stores from Arbor Drugs, bringing its store total to 4,100 across 24 states. The transaction gave CVS its first stores in Michigan and an instant lead in the highly competitive Detroit market.
• In 1999, CVS acquired Soma.com, the first online pharmacy, and renamed it CVS.com. This allowed CVS to become the first fully integrated online and brick-and-mortar pharmacy.
• In 2004, CVS purchased 1,268 Eckerd drug stores, as well as Eckerd Health Services, a PBM/Mail-order pharmacy business, from J. C. Penney. Most of the former Eckerd stores, which were converted to CVS stores by June, are located in Florida and Texas, as well as other southeastern states. Because J. C. Penney credit cards were accepted at Eckerd locations, CVS continues to accept them as well.
• On January 23, 2006, CVS announced that it had agreed to acquire the freestanding drug store operations of supermarket chain Albertsons. The deal included the acquisition of 700 drug stores trading under the Osco Drug and Sav-On Drugs banners, mostly in the midwestern and southwestern United States with primary concentration of stores in southern California and the Chicago area, and was formally completed on June 2, 2006. Transition of Sav-On and Osco stores to the CVS brand began shortly thereafter, and was completed by December 2006. CVS now dominates the southern California market. Also included were Albertsons Health'n'Home (now CVS Home Health) durable medical equipment stores. Approximately 28 CVS Home Health locations are present in Arizona, California and the Kansas City area, representing CVS' first venture into the specialized DME market.
  CVS had previously operated stores in southern California, but completely withdrew from the market in 1993. CVS sold virtually all of the locations to Sav-On's then owner American Stores, who operated them under the name American Drug Stores. As a result, many of the stores CVS gained in January 2006 had been the stores it owned prior to 1993. Before their re-acquisition, the stores were operated under the name Sav-On Express (the Express name was used to help customers identify those stores that did not carry all the lines of merchandise as compared to the larger, traditional Sav-On Drugs locations). CVS now operates over 6,200 stores in 43 states and the District of Columbia. In some locations CVS now has two stores less than two blocks apart.

• On July 13, 2006, CVS announced that it had entered into a definitive agreement to acquire Minneapolis-based MinuteClinic, the pioneer and largest provider of retail-based health clinics in the U.S. MinuteClinic operates as a wholly owned subsidiary of CVS Corporation. MinuteClinic health care centers are staffed by board-certified nurse practitioners and physician assistants who are trained to diagnose and treat common family illnesses such as strep throat and ear, eye, sinus, bladder and bronchial infections, and provide prescriptions when clinically appropriate. MinuteClinic also offers common vaccinations, such as flu shots, tetanus, and Hepatitis A & B. The clinics are supported by physicians who collaborate with the physician assistants and nurse practitioners. There are currently over 550 locations across the United States, most of which are within CVS Pharmacy locations.
• On November 1, 2006, CVS announced that it was entering into a purchase agreement with Nashville-based Caremark Rx Inc., a pharmacy benefits manager. The new company is called CVS Caremark Corporation and the corporate headquarters remains in Woonsocket, Rhode Island. The new pharmacy services business, including the combined pharmacy benefits management (PBM), specialty pharmacy, and disease management businesses, is headquartered in Nashville, Tennessee. The new CVS Caremark Corporation is expected to achieve about $75 billion in yearly revenue for 2007. The merger was formally completed on March 22, 2007. Tom Ryan, CVS's Chairman and CEO, remains president and CEO of the combined company, while Caremark's President and CEO, Mac Crawford, is Chairman of the Board.
• On November 7, 2007, Mac Crawford stepped down as Chairman of the Board for CVS Caremark. He was replaced by President and CEO of CVS Caremark, Tom Ryan.
• On August 12, 2008, CVS Pharmacy announced that it would acquire Longs Drugs for $2.9 billion. Walgreens made a counteroffer, but dropped it. The deal closed Oct 30, 2008.