Finally ending its quest to be the "cool" pharmacy, CVS announced on Wednesday that its stores will stop selling cigarettes and other tobacco products by October 1. The move will cost the chain an estimated $2 billion per year, though, in the long term, the company stands to make more by banning tobacco sales.
"Ending the sale of cigarettes and tobacco products at CVS/pharmacy is simply the right thing to do for the good of our customers and our company," the company said in a statement. "The sale of tobacco products is inconsistent with our purpose – helping people on their path to better health."
CVS is the first major pharmacy to ban tobacco sales, though many smaller, independently-owned pharmacies have already done so. "This action may not lead many people to stop smoking; smokers will probably simply go elsewhere to buy cigarettes," CVS medical officer Dr. Troyen Brennan wrote in an editorial published Wednesday in the Journal of the American Medical Association, according to NBC News. "But if other retailers follow this lead, tobacco products will become much more difficult to obtain."
Health experts and government officials have praised the move. President Obama, a smoker himself, said in a statement that it will have a "profoundly positive impact on the health of our country." Dr. Michael Fiore of the University of Wisconsin's Center for Tobacco Research and Intervention told NBC News also applauded the decision. "There's a disconnect if the mission of a store is to promote health to sell a product that's going to kill half of the people who use it," he said.
While the $2 billion a year in lost sales for CVS seems huge, it actually represents just a fraction of the company's total revenues, which topped $123 billion in 2012. And—surprise, surprise—the decision isn't entirely altruistic and health-related; it should, in theory, let CVS make even more money. From Wonkblog:
CVS executives said the decision could cost billions of dollars in revenue because cigarettes draw so many customers in their stores. But by jettisoning tobacco products, CVS can further evolve their pharmacies into full-fledged health care providers and strike more profitable deals with hospitals and health insurers. Its stores already are home to over 750 MinuteClinics, the country's largest chain of pharmacy-based health clinics, where ordinary Americans can get flu shots or check out earaches and sore throats.
"An important and growing part of our business is the work we do with clients and health insurance plans," CVS Pharmacy president Helena Foulkes said in an interview Tuesday. "As we thought about supporting their goals about improving outcomes and lowering costs, we believe that's the future we're looking towards. As we become more connected to their health care work, this is an important decision for us to make."
[Image via AP]