CVS Health Corp. is launching next-day delivery of prescription medication, a move that comes as the drugstore giant faces declining retail sales and potential competition from Amazon.com Inc.
CVS on Monday said it would offer the service nationwide starting early next year, and same-day delivery in some urban areas. In Manhattan, the company will offer free same day delivery service starting Dec. 4.
CVS declined to say what company it paired with to offer nationwide delivery. The prescriptions will be shipped from pharmacies and a selection of store products also will be eligible for delivery. As the pharmacy industry shifts, CVS's revenue has declined in its retail locations.
On Monday, it reported that retail sales, including prescriptions, fell 2.7% to roughly 42% of overall revenue in the period ended Sept. 30, while revenue in its pharmacy benefit manager, or PBM, operations jumped 8.1%.
Meanwhile, Amazon is considering entering the pharmacy business, which is a factor in CVS's decision to pursue a $66 billion bid for insurer Aetna Inc. CVS executives, in discussing quarterly earnings results on Monday, didn't address talks with Aetna, reported last month by The Wall Street Journal.
Asked how much delivery would cost, Helena Foulkes, who runs the company's retail business, didn't specify but said CVS was able to “use our scale to secure a low-cost, competitive option” that the company believes customers will pay for.
For the quarter, CVS reported a profit of $1.3 billion, or $1.26 a share, down 1.3% from $1.5 billion, or $1.43 a share, a year ago.
BY SHARON TERLEP