CVS Health will separate its approximately 9,000 retail drugstores from its insurance operations and pharmacy benefit manager, Caremark, into two distinct publicly traded companies. The entity retaining the CVS Health name will be led by current CEO David Joyner and will include Oak Street Health, Signify Health, and the specialty drug division. In 2025, the company's healthcare services segment led performance with $51.24 billion in sales, outpacing the retail pharmacy and insurance divisions. The move follows an October 2024 strategic review, extensive store closures, and $2 billion in targeted cost reductions.
Key points
The planned breakup effectively unwinds the company's 2018 acquisition of health insurer…: The planned breakup effectively unwinds the company's 2018 acquisition of health insurer Aetna and dismantles its vertically integrated model.
The separation helps the organization navigate intensifying state and federal regulatory…: The separation helps the organization navigate intensifying state and federal regulatory scrutiny over pharmacy benefit manager pricing models and retail ownership.
Existing CVS Health shareholders will receive ownership stakes in both resulting publicly…: Existing CVS Health shareholders will receive ownership stakes in both resulting publicly traded companies upon completion of the transaction.
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CVS Health plans to split into two separate public companies by early 2028, in what would be one of the largest corporate splits in history, the company announced Wednesday.
The move would reverse the company's massive $78 billion acquisition of its insurer, Aetna, and dismantle the vertically integrated healthcare conglomerate it created in 2018. The plan would specifically separate CVS's roughly 9,000 retail pharmacies from its major insurance business and pharmacy benefit manager, Caremark, one of the nation's three largest PBMs.
It's a stunning reversal for the healthcare powerhouse, which has spent the last two decades working to turn itself into a one-stop health destination. The move also comes as CVS's aggressive turnaround plan under CEO David Joyner shows substantial progress, with the company pursuing $2 billion in cost cuts, store closures, leadership shakeups and efforts to rein in Medicare Advantage costs.
Shares have jumped roughly 70% since Joyner took the helm in October 2024, bringing the company's market value to $117 billion.
The two new companies would both be publicly traded, one of which will retain the CVS Health…
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