Express Scripts Is A Better Investment Than CVS
Uncommon Profit Investor • 21 Comments
Uncommon Profit Investor • 21 Comments
Aug. 10, 2015, 12:25 PM
- CVS Health (CVS +0.8%), the number two pharmacy benefit manager (PBM), says it will wait until a second PCSK9 inhibitor is approved before adding either one to its list of covered drugs and negotiating price discounts, clearly an effective strategy if its hopes to win significant price reductions, which is likely if one firm secures exclusive coverage.
- Last month, the FDA cleared Praluent (alirocumab), co-developed by Sanofi (SNY +1.6%) and Regeneron Pharmaceuticals (REGN +0.9%). The PDUFA date for a second PCSK9 inhibitor, Amgen's (AMGN -0.8%) Repatha (evolocumab), is August 27.
- PCSK9 inhibitors are the "next big thing" in lowering bad cholesterol. They ain't cheap, though. Generic statins cost ~$50 per month while Praluent costs ~$1,200 before discounts.
Aug. 4, 2015, 3:33 PM
- Effective January 1, 2016, Orexo AB's (OTC:ORXOF) (OTCQX:ORXOY) Zubsolv (buprenorphine and naloxone) will no longer be in a preferred position in CVS Caremark's (CVS -2.6%) formulary and will be excluded from the high controlled commercial plans where Zubsolv has been the only branded option since January 2014. The company believes the action, which apparently came as a surprise, could negatively impact sales 10 - 15%.
- Zubsolv is indicated for patients suffering from opioid dependence.
Aug. 4, 2015, 7:03 AM
- CVS Health (NYSE:CVS): Q2 EPS of $1.22 beats by $0.02.
- Revenue of $37.17B (+7.4% Y/Y) in-line.
Aug. 3, 2015, 5:30 PM
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Jul. 31, 2015, 8:06 AM
- CVS Health (NYSE:CVS) faces a new lawsuit alleging the company purposefully overcharged pharmacy customers for generic drugs.
- The legal action seeks class-action status from a judge and an order prohibiting CVS from pricing above co-payment levels.
- The company says it hasn't reviewed the lawsuit yet.
Jul. 30, 2015, 1:37 PM
- Unsurprisingly, Express Scripts (ESRX -0.6%) takes a dim view of the proposed price of the cholesterol-lowering PCSK9 inhibitor Praluent (alirocumab). Last Friday, co-developers Sanofi (SNY +1.6%) and Regeneron Pharmaceuticals (REGN +0.4%) announced that the wholesale acquisition cost (WAC) of the once-every-two-week injection will be $40 per day or $14,600 per year. This is several orders of magnitude above the cost of statins, which average $2 - 3 per day.
- WAC is the average price that wholesalers and distributors pay for the drug. Patients will, of course, pay quite a bit more.
- Pharmacy benefit managers, still feeling the pinch from Gilead's (GILD +1.8%) HCV meds Sovaldi and Harvoni, will likely ratchet up their opposition as Praluent's U.S. launch commences.
- Related tickers: (AET +0.9%)(CTRX)(CNC +0.9%)(CI -0.7%)(HUM)(MRK +0.3%)(OCR +0.4%)(UNH -0.7%)(CVS -0.5%)
Jul. 17, 2015, 6:20 PM
- CVS Health (NYSE:CVS) and Walmart Canada (NYSE:WMT) say a data breach at a Canadian IT vendor owned by Staples (NASDAQ:SPLS) may have leaked credit card information from their online photo processing websites, possibly compromising data on millions of users.
- The retailers have temporarily shut down their online photo processing services and related mobile services, and urge customers to check their credit card records for any suspicious activity.
- The vendor also provides software to Costco's (NASDAQ:COST) online photo processing services, but its photo site apparently was functioning today.
Jul. 15, 2015, 12:36 PM
- Moody's raises its outlook on the U.S. retail industry to Positive from Stable on its view operating income will improve by 5% to 6% over the next 12 to 18 months.
- The ratings agency is focused on the expense side, seeing a leveraging of fixed costs and efficiency gains as helping to pad bottom lines.
- Sectors seen leading the way for profit growth are dollar stores (FDO, DG, DLTR), drug stores (WBA, CVS, RAD), and home improvement chains (HD, LOW).
- Related ETFs: XLY, XRT, VCR, RTH, RETL, IYK, FXD, FDIS, RCD, PMR, UGE, SZK
Jul. 8, 2015, 12:55 PM
- CVS Health (NYSE:CVS) declares $0.35/share quarterly dividend, in line with previous.
- Forward yield 1.34%
- Payable Aug. 3; for shareholders of record July 23; ex-div July 21.
Jun. 15, 2015, 8:05 AM
- CVS Health (NYSE:CVS) announces it will trim its share repurchase guidance to $5B from a prior level of $6B.
- The action will help the company keep its target adjusted debt to EBITDA leverage ratio at approximately 3.2 after the acquisitions of Omnicare and Target's pharmacy businesses close.
- Previously: Target and CVS Health sign major partnership
- CVS +0.8% premarket to $102.99 following the Target announcement.
Jun. 15, 2015, 7:15 AM
- CVS Health (NYSE:CVS) acquires the pharmacy and clinic business of Target (NYSE:TGT) for $1.9B.
- The deal will cover more than 1.6K locations spread across 47 different U.S. states.
- The pharmacies will continue to operate within Target stores rebranded under the CVS format.
- The agreement also calls for Target and CVS to partner on ten new small-format stores.
- Target sees extra traffic resulting from the strategic agreement with CVS, while the expansion falls under a plan to CVS to grow its store base.
Jun. 9, 2015, 10:55 AM
- CVS Health (CVS -0.1%) initiated with Outperform rating and $115 (16% upside) price target by Macquarie.
- Galapagos (GLPG -3%) initiated with Overweight rating and $73 (36% upside) price target by Morgan Stanley.
- LifePoint Health (LPNT) initiated with Conviction Buy rating and $92 (25% upside) price target by Goldman Sachs.
- BioMarin Pharmaceutical (BMRN -2.2%) initiated with Overweight rating and $150 (24% upside) price target by Barclays.
- Universal Health Services (UHS +0.2%) initiated with Neutral rating and $140 (10% upside) price target by Goldman Sachs.
- Amsurg (AMSG -0.5%) initiated with Buy rating and $81 (17% upside) price target by Goldman Sachs.
- Momenta Pharmaceuticals (MNTA -2.6%) initiated with Buy rating and $26 (18% upside) price target by Stifel Nicolaus.
- Actavis (ACT -0.6%) initiated with Outperform rating and $344 (16% upside) price target by Raymond James.
May 21, 2015, 7:32 AM
- CVS Health (NYSE:CVS) confirms it will acquire Omnicare (NYSE:OCR) for $98 per share in a deal valued at $12.7B.
- The transaction is expected to close near the end of the year.
- The company sees the purchase adding $0.20 to EPS in 2016
- Previously: Bloomberg: CVS in advanced talks to buy Omnicare
- OCR +1.39% premarket to $95.95.
- CVS +1.77% premarket to $103.06.
May 20, 2015, 6:15 PM
- CVS is in advanced talks to buy nursing home pharmacy owner Omnicare (NYSE:OCR) and could reach a deal as soon as this week, sources tell Bloomberg.
- Omnicare hired advisors to find a buyer earlier this year. In April, Bloomberg reported CVS was one of several interested parties.
- OCR +5.7% AH to $100.00. CVS +0.5% to $101.80.
May 13, 2015, 12:22 PM
- CVS Health (CVS -0.5%) settles the case brought by the U.S. Attorney's Office for the Middle District of Florida and the U.S. Drug Enforcement Administration (DEA) concerning allegations related to the over-dispensing of oxycodone by two CVS stores in Sanford, Florida. The company agreed to pay $22M to resolve the matter.
- In 2012, the DEA banned the two pharmacies from selling controlled drugs calling them an "imminent danger" to the public. The average pharmacy in the U.S. ordered ~69K oxycodone pills from wholesalers in 2011. The two pharmacies in question, located about five miles apart, ordered more than 3M.
May 1, 2015, 8:59 AM
- CVS Health (NYSE:CVS) Q1 results ($M): Total Revenues: 36,332 (+11.1%); Net Income: 1,221 (+8.1%); GAAP EPS: 1.07 (+12.6%); Non-GAAP EPS: 1.14 (+11.8%); Quick Assets: 1,634 (-35.0%); CF Ops: 1,984 (-8.7%);
- Retail Pharmacy revenue up 2.9% to $16.95B.
- Retail Pharmacy same-store sales up 1.2%.
- Retail Pharmacy same-store prescription volumes up 5.1%.
- Generic dispensing rate: Pharmacy services: 83.5% (+150 bps); Retail Pharmacy: 84.4% (+150 bps).
- Gross margin rate down 121 bps to 16.97%.
- Operating margin rate down 32 bps to 5.87%.
- FY2015 Guidance: GAAP EPS: $4.80 to $4.91; Non-GAAP EPS: $5.08 to $5.19; CF Ops: $7.6B to $7.9B.
- Q2 Guidance: GAAP EPS: $1.10 to $1.13; Non-GAAP EPS: $1.17 to $1.20.
- Shares up 2% premarket on light volume.
CVS Health Corp. is integrated pharmacy health care provider in the U.S. The company reinvents pharmacy for better health and develops new ways to improve access for patients, promote better health outcomes and control payor costs in a way that no pharmacy retailer or PBM could do separately. It... More
Industry: Drug Stores
Country: United States
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