According to CVS Health, approximately two thirds of teens have abused prescription drugs. They are known to mostly obtain them from family or friends or acquaintances. This social issue has become an important political battleground and thankfully it can now be prevented through the safe disposal of unwanted medications.
In a move to meet their goal of drug abuse prevention, CVS, a pharmacy innovation company, launched their Medication Disposal for Safer Communities program. Through the program the police departments are able to make an application of receiving a drug collection unit that will ensure the community disposes unwanted medications safely. Since the year 2014, a total of 626 drug collection units have been donated to police departments in about 42 states. In addition, prescription drugs of more than 47 metric tons have been collected through the program. The program has proved to be very beneficial because in addition to preventing medication diversion and abuse it also ensures the environment is not polluted by ensuring medications that are improperly disposed do not contaminate the water supply.
According to Tom Davis, a vice president at the company, the disposal program together with the Partnership for Drug-Free Kids work together to come up with a permanent solution of drug disposal for the community. There are other ways which CV’S continue to support disposal efforts of prescription drug. They include providing their parking lot as collection site and use of customized in-store signage to promote programs focused on getting permanent drug disposal collection site. There are also hundreds of CVS pharmacy locations serving as collection sites of unwanted medication. All these locations provide envelopes that customers can use to send medications that are unwanted to be disposed safely. Another way is through the CVS.com tool launched by the company to allow visitors search ZIP code to get a disposal location of unwanted medications.
Summary of Health Industry
CVS Health is currently having a leading presence in the long-term pharmacy care. Having a competitive advantage has enabled the company to fit in the industry and benefit from various market trends. In the past five years, of the 710 million prescriptions that were added in the market, CVS has managed to capture 39% through their dispensing channels. The company share in the market is growing.
CVS has not been stagnant in the industry. The company has broadened its reach into new health care channels and industry in 2015, by acqiring Omnicare, the largest leading provider of pharmacy services in the nation. They also continued to grow the core pharmacy business by the purchase of more than 1,670 pharmacies and almost 80 retail clinics from Target Corporation. These transactions expanded the company’s pharmacy count by 20 percent and the number of clinics by 8 percent. These company trends have been a key driver of revenue gains.
Throughout the year 2015, CVS have managed to capture an outsized share of the specialty market, which is the sector that is growing fast in the industry. The company’s specialty business is the largest in the nation, and its growth has out-spaced both its nearest competitor and industry overall. In 2015, the total revenue generated from the specialty drugs dispensed and managed in the entire enterprise amounted to $40 billion representing a 32% increase from previous year.
Since the year 2010, CVS prescription business has grown twice the overall market rate. At the pharmacy, sales from same store increased 1.7percent in 2015. In 2014, same store sales increased by 4.5 percent, and front store sale decreased by 5 percent which was driven by the company exit from sale of tobacco. In 2015, CVS Pharmacy filled around 21.6% of the retail prescriptions to lead the retail drug store in U.S
Summary of Company future Plan
CVS managed to meet its financial target through its continuous focus on three pillars which include: productive, long-term growth that consider essential to maximizing shareholder value, generating significant free cash flow, and optimizing capital allocation. The company generated nearly $7 billion in free cash flow and adjusted net revenues for the year increased 10 percent to a record as $153 billion, and earnings for the year also increased nearly 15 percent to $6 billion on a comparable basis in 2015. With a high client retention rate of 98%, and net new business wins for 2016 totaled $12.7 billion which reflects the value of CVS.
According to the Chief Executive officer, the company hopes that its leadership across the pharmacy spectrum will help them continue to drive superior value for the company’s health care partners and shareholders. As the company expands its core pharmacy business, it also plans to broaden its reach into new health care channels and make investments to drive sustainable enterprise growth. CVS have strengthened its position with Hispanic customers through launching CVS Pharmacy y mas in several locations in Miami. The stores offer unique Hispanic products and services not in the traditional drugstores which have led to an increase in sales by 10percent. The company plans to expand on the concept in future.
Through its combined enterprise assets, the company also plans to bridge the historic gaps in Omnicare’s offerings to the address the population’s unmet needs. For instance, the robust offering of Omnicare of skilled nursing facility market failed to include a complete solution of addressing care coordination issues during the discharge or admission of a patient. Considering the many retail locations, CVS can ensure timeliness of medication adherence through emergency prescriptions, a move that will reduce expensive hospital admission. In addition, the company is developing integrated solutions of independent and assisted living, and also home care markets.