CVS Health Has Decided to Split Off Its Pharmacies, the Journal Reports

CVS Health has decided to split in two in early 2028, The Wall Street Journal reported Tuesday, separating its pharmacies from Aetna and Caremark.

CVS Health Corporation (NYSE: CVS) is based in Woonsocket, Rhode Island. A pharmacy benefit manager, or PBM, runs drug coverage for employers and health plans. CVS owns a PBM, an insurer, and a national drugstore chain.

What the Journal reported decided

The Journal reported that CVS Health has decided to split in two. The breakup is planned for early 2028. No company announcement had been issued when the report landed.

One company would be called CVS Pharmacy. It would hold about nine thousand retail pharmacies. It would also hold mail-order pharmacy, MinuteClinic, and Health100. Health100 is a consumer digital tool powered by artificial intelligence.

The other company would keep the CVS Health name. Chief Executive David Joyner would run it. It would house insurer Aetna and PBM Caremark. Signify Health, Oak Street Health, and specialty pharmacy would sit there too.

Both companies would be publicly traded. Current shareholders would own shares in both. The two firms would stay tied by a commercial agreement, the Journal reported.

Joyner spoke on the record to the Journal. "We believe based off of where we are and how we're performing, the businesses are best served by splitting," he said. "We're basically taking what I believe is one great company and making it two."

He argued the pairing left behind still fits. Aetna and Caremark manage health and drug benefits. Their synergies make sense together, he said. The senior-focused clinics would bolster Aetna's Medicare business.

The pharmacy side would stand alone with known problems. Retail drugstores face long-running challenges. Without the PBM and insurance units, that protection disappears. Walgreens, the big pharmacy rival, went private last year. It had struggled to regain momentum.

How the day's reporting moved

The Financial Times reported first on Tuesday. It said CVS was considering a spin-off. It cited people familiar with the matter. It said the structure and timing remained fluid.

Reuters then added a caution. A person familiar with the matter told Reuters no final decision had been made. CVS did not immediately respond to a Reuters comment request.

The Journal's later report went further. It described a decision, with named businesses and a date. That sequence matters. Deliberation, caution, and decision are three different claims.

The company the split would undo

The split would reverse the Aetna combination. CVS announced the Aetna acquisition in December 2017. The announcement valued Aetna at about $69 billion. Including assumed debt, the total value was $77 billion. The deal closed in 2018.

Some reports describe the purchase as about $78 billion. That figure belongs to the total-value family of numbers. This article uses the announcement's own framing. The equity value and the debt-inclusive total are kept separate.

Joyner took over in October 2024. He replaced Karen Lynch, who stepped down in agreement with the board. The FT carrier noted Glenview Capital had pushed for changes before her departure.

The recovery since then frames the timing. Reports put the market value near $117 billion. The pharmacy division brings in about one-third of projected revenue. That projection is $417 billion for 2026, per the FT report.

Why regulators are part of the story

Vertically integrated health companies face growing scrutiny. Federal and state lawmakers have pressed PBMs in both parties. Tennessee and Arkansas passed laws against co-owning pharmacies and PBMs. CVS and others have challenged those laws in court.

Joyner addressed that backdrop directly. He told the Journal the company was not splitting because of regulatory issues. He said Aetna had turned around. He said retail performance had improved. The split, in his telling, comes from strength.

Shares rose, then faded after hours

Shares closed Tuesday at $91.41, up 3.28%. The prior close was $88.51 on Monday. The regular session gain came before the Journal's report.

After hours, the last trade was $89.58 at 7:59 p.m. ET. By TickerGrove's calculation, that is down 2.0% from the close. The after-hours high was $94.80. Earlier reports had shares up between 0.1% and 2% after hours. Those were earlier snapshots, not the settled print.

What remains unknown

What remains unknown starts with the formal announcement. CVS had issued no release or filing on the split by late Tuesday. The tax structure is unstated. Debt allocation between the two companies is unstated.

Who would lead CVS Pharmacy is unstated. Regulatory approvals are untested. Whether the early-2028 timing holds is unproven. The commercial agreement's terms are undisclosed.

What to watch next

What to watch is Wednesday's third-quarter report. CVS reports before the market opens on November 4. Its call is at 8:00 a.m. ET. Formal confirmation, if it comes, would likely come there.

Watch for a company release or filing that turns reporting into terms. Watch the next regular close against the after-hours snapshot. Watch whether CVS Pharmacy's leader and the debt split get named.