First retail clinic opens at Medway CVS

Massachusetts joined the retail medical clinic revolution in primary care today when the state's first MinuteClinic opened in a CVS store in Medway.

The limited-service clinics, staffed by board-certified nurse practitioners, offer treatment for minor illnesses and vaccinations for common diseases, including flu shots starting next month. The model of care is designed to offer convenient access for patients with sore throats or rashes who may not be able to make an appointment with their primary care doctors, or who may not have a regular healthcare provider. The clinics will be open 8 a.m. to 8 p.m. weekdays and 10 a.m. to 4 p.m. weekends. A visit costs $59.

By late morning two patients had already been seen for minor illnesses, MinuteClinic chief nursing officer Donna Haugland said in a phone interview from the store in the town southwest of Boston. One patient came in after seeing television reports about the clinic's opening day and another person working across the street came in when her boss urged her to get help, Haugland said, declining to be more specific about their conditions.

"My experience working in these clinics is patients are very excited to have access and convenience for minor acute illnesses," said Haugland, a nurse practitioner who staffed a Minneapolis MinuteClinic for 18 months. "Sometimes they can't wait for an appointment with their primary care physician or there are long waits in urgent care or the emergency room."

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Longs Drug Stores rejects Walgreen offer

Longs Drug Stores Corp. on Wednesday said it will not enter into discussions with Walgreen Co. about its $2.8 billion bid for the drugstore operator.

Walgreen made a $75-per-share offer for Walnut Creek, Calif.-based Longs on Friday, hoping to unseat Woonsocket, R.I.-based CVS Caremark Corp.'s previous bid of $71.50 per share, worth about $2.7 billion.

CVS reaffirmed its offer on Sunday and extended the deadline to Oct. 15.

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CVS to open high-end beauty stores

CHICAGO, Aug 22 (Reuters) - CVS Caremark Corp (CVS.N: Quote, Profile, Research, Stock Buzz) will begin testing a high-end beauty store concept this year, looking to tap into growing demand for skin care and cosmetics seen at outlets like LVMH's (LVMH.PA: Quote, Profile, Research, Stock Buzz) Sephora chain.

The drug store chain operator plans to open a store called "Beauty 360" by the end of the year next to existing CVS stores on the U.S. East Coast and another on the West Coast shortly thereafter, CVS spokeswoman Eileen Howard Dunn said on Friday.

She declined to say where the stores would be located. But Women's Wear Daily, which first reported the news, said the first would be opened in Washington, D.C., and the second in Sacramento, California.

The "prestige beauty" stores would carry 32 lines of skin care and cosmetics plus a number of fragrances, Dunn said. She declined to name the brands.

CVS's expansion efforts in recent years have been in the health-care realm, notably with the acquisition last year of Caremark, a pharmacy benefits manager.

Dunn said the company has also focused on building up beauty product offerings in its stores with research showing demand on the higher end.

"Beauty has always been a core part of our front-of-store offering, so this is the next evolution," she said.

CVS will have more than 6,800 stores if it completes its planned purchase of Longs Drug Stores Corp (LDG.N: Quote, Profile, Research, Stock Buzz). That geographic reach is one weapon it can bring into prestige beauty battle with Sephora, Dunn said.

She also stressed that the company does not plan to build a Beauty 360 shop next to every CVS store.

Aside from the first two stores, the company plans to test a few more, Dunn said.

Source: Reuters

CVS Caremark buys Longs Drug Stores

Drug store chain CVS Caremark Corp., looking to build its West Coast presence, said Tuesday it would buy Longs Drug Stores Corp. in a deal valued at $2.7 billion. The $71.50 per-share cash offer, announced after the end of trading Tuesday, was a 32 percent premium over Walnut Creek, Calif.-based Longs' closing price of $54.04. Longs' shares soared 30 percent, or $16.21, to $70.25 in after-hours trading. Including the assumption of the chain's roughly $200 million in debt, the deal is valued at about $2.9 billion. Executives at Woonsocket, Rhode Island-based CVS said the acquisition will give the nation's largest provider of prescriptions significant inroads in fast-growing West Coat markets where property is often unavailable or expensive to acquire. "Geographic reach has become a more important thing for us," CVS Chief Financial Officer David Rickard told The Associated Press in an interview. "CVS has always wanted to be in good markets that grow, and if you look at population centers of the United States, we're in most of them. ... This directly addresses the central and northern California markets and gives us access to those consumers." The deal is expected to close in the fourth quarter. Longs operates 521 drugstores _ mostly in California _ but also has sites in Hawaii, Nevada and Arizona. The company also owns Rx America, a prescription benefits management program with more than 8 million members. CVS executives said building such a portfolio could take the pharmacy chain a decade to complete, while spending hundreds of millions to acquire on property. "These are highly attractive regions of the country, where we are not currently represented," CVS Chairman and Chief Executive Tom Ryan told investors during a conference call. "And they are very difficult real estate markets to penetrate." The Longs stores in the continental United States will be converted to the CVS brand in 2009, while sites in Hawaii will retain the Longs' name for the foreseeable future. After the acquisition is completed, CVS will operate 6,800 drugstores in 41 states and the District of Columbia. "Given our changing industry landscape, we believe this combination is the logical step for our company," said Warren F. Bryant, Chairman and Chief Executive Officer of Longs. Longs' stock has climbed since the spring amid speculation the company would seek an outright sale or alternatives for its real estate portfolio. During the second quarter, the company's same-store sales fell 1.1 percent as more generic drugs flooding the market ate into profits. Meanwhile, total sales increased 0.5 percent to $1.2 billion. Year-to-date, Longs said its same-store sales declined 0.1 percent, but total sales increased 1.7 percent CVS shares fell 49 cents, or 1.3 percent, to $38.05 in trading Tuesday, before falling $1.67, or 4.4 percent, to $36.38 in after-hours activity. Source: Indianapolis Business Journal

BIGresearch: Walgreens Losing Ground Among Prescription Drug Shoppers?

Wal-Mart Filling More Prescriptions Among Lower Income Shoppers

Walgreens remains the retailer of choice in the Prescription Drugs category among all adults (14.4% say they shop there most often), according to the July Retail Ratings Report from BIGresearch ( http://www.bigresearch.com). However, it appears that Wal-Mart is closing the gap and increasing share of preference in this category.

Walgreens' share decreased almost a point from July 07 (15.2%), resulting in a negative Consumer Equity Index(TM) (CEI)* of 94.35. #2 CVS saw a marginal decrease in consumer share year over year (13.2% in Jul 08 v. 13.6% in July 07), giving them a negative Consumer Equity Index(TM) (CEI)* of 97.68. Conversely, #3 Wal-Mart is growing in popularity with a two point increase in share to 10.4% (v. 8.4% in Jul 07) and a CEI of 123.71, indicating almost a 24% growth in share. *CEI measures growth in share year over year. An index of 100 is flat, while an index of 105 indicates 5% growth.

Wal-Mart is also improved among consumers with household incomes greater than $50,000. 8.2% say they shop there most often for prescriptions (v. 6.3% in July 07), giving third place Wal-Mart a CEI of 131.73. This is a significantly higher rating than the leaders in the category: Walgreens (94.53) and CVS (100.31).

Over the past year, CVS and Wal-Mart have been battling it out for the number 2 position among consumers with household incomes less than $50,000. However, Wal-Mart surpassed CVS in July. This coupled with Walgreen's two-point nose dive in consumer preference share, gives Wal-Mart a piece of the lead among this consumer group.

Prescription Drugs (Shop at Most Often) - HH Income Less Than $50K
           Share           Share          Share
Store        Jul 2007        Jul 2008       +/-       CEI
Wal-Mart     12.0%           13.8%           1.8      115.43
CVS          13.9%           12.2%          -1.8      87.36
Walgreens    15.8%           13.8%          -2.0      87.37
Source: BIGresearch, Retail Ratings Report, Jul 08

"The current economic environment appears to be helping Wal-Mart increase their share among lower income shoppers," said Pam Goodfellow, Senior Analyst at BIGresearch. "Wal-Mart's growth seems to be at the expense of Walgreens and CVS."

Source: MarketWatch

CVS Caremark sees 2008 same-store sales up 4-7 pct

CHICAGO, May 1 (Reuters) - CVS Caremark Corp (CVS.N: Quote, Profile, Research) on Thursday forecast a 4 percent to 7 percent increase in 2008 sales at drugstores open at least a year, and also raised the lower-end of its earnings forecast by a penny.

The company now expects earnings per share of $2.27 to $2.33 on a reported basis, up from its January forecast of $2.26 to $2.33.

Analysts on average forecast $2.32 a share, according to Reuters Estimates. (Reporting by Brad Dorfman, editing by Gerald E. McCormick)

CVS Sees New Growth

Woonsocket-based CVS Caremark Corp. chief executive officer Thomas Ryan said yesterday that slowing consumer spending is having a “limited effect” on the biggest U.S. drugstore chain by number of stores.

“People will keep filling prescriptions and taking care of personal hygiene and nutrition,” Ryan said in an interview on Bloomberg Television. About 85 percent of the company’s revenue comes from purchases of drugs and health-care products.

Consumers are trimming spending as they face higher gasoline and food prices, declining house values and more uncertainty about employment after further job losses.

“You have about 3 percent of our business that’s affected by the economy,” Ryan, 55, said.

Revenue will rise to “well over $85 billion” this year, CVS said in a statement. That’s in line with a January forecast for sales growth of 13 percent to 16 percent compared with a year earlier, spokeswoman Carolyn Castel said by telephone. Eighteen analysts surveyed by Bloomberg estimated revenue of $87.1 billion this year.

Ryan rang the opening bell at the New York Stock Exchange to commemorate the first anniversary of CVS’s $27-billion acquisition of Caremark Rx Inc. in a deal that made it the second-largest manager of employee-pharmacy benefits.

“As the nation’s number-one prescription provider, we are leveraging our unique combination to help payers control costs more effectively, improve patient access and promote better health outcomes,” Ryan said. “Our integrated model provides us with an opportunity to gain share and create new sources of growth in 2008 and beyond.”

The company operates the largest retail pharmacy chain by store count with 6,300 CVS/pharmacy stores; the largest and fastest-growing retail clinic business through MinuteClinic; the largest specialty pharmacy and health-management programs; and one of the leading mail-order pharmacies.

CVS rose $1.07, or 2.7 percent, to $40.92 at 4 p.m. in New York Stock Exchange composite trading. The shares have climbed 2.9 percent this year.

Source: Providence Journal