Wednesday, February 5, 2014

CVS Says It Will Forgo $2 Billion to Stop Selling Smokes

Posted By on Wed, Feb 5, 2014 at 9:53 AM

The big question following CVS's big announcement this morning that it would stop selling all cigarettes and tobacco products by this October was: Who will follow?

Rite-Aid, Walgreens, Wal-Mart and the nation's financial markets are watching reactions very closely today after CVS said it was willing to forgo nearly $2 billion in profits in order to fortify its brand as a caregiver in addition to its retail services.

CVS sees its future in making its in-store clinics a convenient health care alternative to long waits at the doctor's office, along with CVS pharmacists counseling patients. That strategy was increasingly at odds with racks of cigarettes, cigars and chewing tobacco residing behind the cashier's counter, said Larry Merlo, chief executive for CVS.

Meanwhile, President Barack Obama, a former smoker himself, wasted no time in heaping praise on CVS:

"As one of the largest retailers and pharmacies in America, CVS sets a powerful example, and today's decision will help advance my administration's efforts to reduce tobacco-related deaths, cancer and heart disease, as well as bring down health care costs—ultimately saving lives and protecting untold numbers of families from pain and heartbreak for years to come," Obama said in a statement.

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