A CVS pharmacy store is seen in the Manhattan borough of New York City, New York.
Shannon Stapleton | Reuters
CVS said on Wednesday that it plans to acquire or take a stake in a primary care company later this year, as competition heats up with Amazon and Walgreens.
CEO Karen Lynch said about the company second quarter earnings called that the company wanted to work with a supplier with a strong management team and technology background and the ability to grow rapidly.
CVS, best known for its many pharmacies, has contacts in the healthcare industry. It acquired insurance company Aetna and pharmacy benefits manager Caremark. Customers can get vaccines or urgent care at MinuteClinic centers inside its stores. And the company also continues to add more medical services to those locations – it recently introduced therapy in some of its stores.
However, CVS does not yet have a doctor’s office where patients can visit for an annual check-up or make an appointment with a doctor or nurse. At an investor day last year, Lynch said CVS want to change that by buying or partnering with a company.
At the time, Dr. Alan Lotvin, executive vice president of CVS Health and president of CVS Caremark, said he envisioned CVS standing out in the primary healthcare sector. The company wants to offer more hours at its doctors’ offices so people can come in as early as 6 a.m., as late as 9 p.m., or on weekends. It also wants to use simple, streamlined technology, so customers don’t have to fill out piles of paperwork.
Other health care players made moves in space. Walgreens Boots Alliance’s competitor is opened hundreds of doctors’ offices in partnership with VillageMD and become the majority owner of the company. Walmart There are a small, but growing number of clinics where people can visit a doctor, dentist or therapist for a low price.
Amazon ramped up the pressure by announcing last month that it would get One Medical primary care provider for about $3.9 billion. Boutique healthcare company with 188 medical offices across 25 markets, according to its latest quarterly result.
Lynch said CVS has a competitive advantage given the size of its business. She said nearly 4.8 million customers interact with the company every day at CVS locations. Plus, she said, MinuteClinic’s visits increased 12% in the fiscal second quarter.
CVS can build “from the solid foundation we already have,” Lynch said.
