WOONSOCKET, R.I. - A recent survey commissioned by CVS Health (NYSE:CVS) has highlighted the pivotal role of community pharmacies in the healthcare system, revealing strong consumer trust in pharmacists and a preference for in-person interactions over digital-only services. The Rx Report, released today by CVS Health, underscores the demand for more services and care to be available at local pharmacies.
According to the survey, 76% of consumers currently manage at least one prescription, either for themselves or someone they care for, and 81% expressed high trust in their local pharmacists. Moreover, the recommendations made by pharmacists are deemed important by 83% of respondents. The report also noted that 79% of consumers had visited a pharmacy within the past year.
The findings suggest that while consumers value the accessibility of pharmacists, with 88% viewing them as the most accessible healthcare providers, there is a clear preference for face-to-face interactions. Approximately 70% of those surveyed indicated they prefer in-person services, and nearly half stated they would consider switching pharmacies if restricted to digital interactions with their pharmacist.
CVS Health is responding to the survey insights by introducing CVS CostVantage, a new pharmacy reimbursement model aimed at simplifying costs with a transparent formula. This initiative is part of the company's efforts to ensure a sustainable business model for the future.
The report also highlights the need to support pharmacy teams better, with investments in the workplace and workforce to enable high-quality care. Despite the high job satisfaction reported by 69% of those working in community, mail, or online pharmacies, the pandemic has intensified existing challenges, prompting companies like CVS Pharmacy to explore new ways of working.
Addressing a decline in pharmacy school enrollments, which have dropped by over 29% in the past five years, CVS Pharmacy is investing in the future workforce through educational programs and professional development opportunities.
The survey, conducted online by Morning Consult from July 1 to July 26, 2024, included 1,000 pharmacists, 53 pharmacy technicians, and 2,201 general consumers in the United States. The consumer data was weighted to approximate a target sample of U.S. adults based on demographic factors.
As the healthcare marketplace rapidly evolves, CVS Health remains committed to transforming the pharmacy industry, addressing challenges, and elevating the role of pharmacy teams. The full report is available for download on the CVS Health website, based on a press release statement.
In other recent news, CVS Health has decided to exit its core infusion services business, leading to the closure or potential sale of 29 regional pharmacies. This strategic move is due to significant challenges faced by the infusion medication sector. Despite this exit, CVS will maintain specialty medication and enteral nutrition services at select locations. The company is also considering the sale of the regional pharmacies slated for closure.
In analyst updates, Barclays has upgraded CVS Health to 'Overweight' from 'Equalweight', citing potential margin recovery and cost-saving initiatives. TD Cowen has also reaffirmed its 'Buy' rating on CVS Health, encouraged by the company's strong performance in the Centers for Medicare & Medicaid Services (CMS) 2025 Star Ratings.
In legal developments, CVS Health, along with UnitedHealth Group (NYSE:UNH) and Cigna (NYSE:CI), have requested the recusal of U.S. Federal Trade Commission Chair Lina Khan and commissioners Rebecca Kelly Slaughter and Alvaro Bedoya from a lawsuit alleging wrongful inflation of insulin prices. The companies argue that the commissioners have shown bias against pharmacy benefit managers, potentially compromising the fairness of the proceedings. These are among the recent developments involving CVS Health.
InvestingPro Insights
The recent survey findings highlighting CVS Health's pivotal role in community healthcare are reflected in the company's financial performance and market position. According to InvestingPro data, CVS boasts a substantial market capitalization of $84.86 billion, underscoring its significant presence in the healthcare sector.
CVS's commitment to shareholder value is evident in its dividend policy. An InvestingPro Tip reveals that the company has raised its dividend for 3 consecutive years, with a current dividend yield of 3.94%. This consistent dividend growth, coupled with a 9.92% increase in the last twelve months, aligns with the company's strong financial position and its ability to generate value for investors while investing in community healthcare initiatives.
The company's revenue growth of 7.03% over the last twelve months to $361.86 billion demonstrates CVS's ability to capitalize on the increasing demand for pharmacy services, as highlighted in the survey. This growth is particularly impressive given the company's already substantial revenue base.
InvestingPro Tips also indicate that CVS is trading at a low revenue valuation multiple, suggesting potential undervaluation despite its strong market position. This could be an attractive point for investors considering the company's role in the evolving healthcare landscape.
For readers interested in a more comprehensive analysis, InvestingPro offers additional tips and insights on CVS Health. In fact, there are 12 more InvestingPro Tips available for CVS, providing a deeper understanding of the company's financial health and market position.
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