CVS Health to Split Retail Pharmacy From Aetna, Caremark by 2028

A planned separation will split CVS Health's retail pharmacies from its insurance, pharmacy benefit management, and care delivery businesses, creating 2 independent, publicly traded companies by the first half of 2028, according to a company announcement.¹

The decision follows a comprehensive strategic review by the CVS Health board of directors. Once the split is complete, CVS Health shareholders will own shares in both companies, and the transaction is intended to be tax-free to the company and its shareholders for US federal income tax purposes. Completion remains subject to customary conditions, including final board approval and the effectiveness of a Form 10 registration statement filed with the Securities and Exchange Commission.

Aetna, Caremark, and Oak Street to Stay Together Under CVS Health

The health care solutions company, which will be referred to as CVS Health in the interim, will comprise insurer Aetna, pharmacy benefit manager (PBM) CVS Caremark, CVS Specialty, primary care provider Oak Street Health, and in-home health business Signify Health. David Joyner, currently chairman and CEO of CVS Health, will serve as chairman and CEO of that company.

“Our history is defined by proactively evolving to stay ahead of what’s next in health care, and in today’s environment, that means delivering more affordability, greater access, and a simpler experience,” said Joyner in a statement. “Over the last 2 years, we have made meaningful progress: we built a world-class leadership team, strengthened our financials, revitalized operations across the enterprise, and drove total shareholder return. From a position of strength and a focus on the long term, we plan to create 2 focused companies to improve consumer engagement, affordability, and care coordination.”

The second company, to be named CVS Pharmacy, will include approximately 9000 retail pharmacies, mail pharmacies, MinuteClinic (including virtual care), and Health100, a technology services business the company says will deliver artificial intelligence-native products and services. Prem Shah, currently group president of CVS Health, will become its CEO. Additional leadership positions and board members will be announced later.

The health care solutions business will maintain the connections among its benefits, pharmacy services, and care delivery assets that the company says help lower costs while improving health outcomes. As a stand-alone company, CVS Pharmacy plans to expand the services offered by its nearly 30,000 pharmacists and pursue a wider set of partnerships with payers, PBMs, and manufacturers. CVS said customers, patients, and clients will continue to receive their medicines, care, benefits, and services without interruption during the separation.

Split Reverses 2018 Aetna Deal as PBM Scrutiny Grows

The move would reverse CVS's $78 billion acquisition of Aetna and dismantle the vertically integrated model the company built in 2018, CNBC reported.² It also comes as the company's turnaround under Joyner, who took over as CEO in October 2024, has included cost cuts, store closures, leadership changes, and efforts to control Medicare Advantage costs. CVS shares have risen roughly 70% since he took the helm, bringing the company's market value to $117 billion. CVS had previously engaged advisors in a strategic review in October 2024 that included weighing a breakup of its retail pharmacy and insurance units. The announcement coincided with third-quarter 2026 results, with revenue climbing to $108.40 billion from $102.87 billion in the prior-year period.

In a Tuesday note, Leerink Partners analyst Michael Cherny said the retail pharmacy business has been gaining market share and seeing gross margins stabilize under CostVantage, the pharmacy reimbursement model CVS introduced last year. He added that the move may also be aimed "to avoid what has been relentless state legislative scrutiny" over how vertically integrated the company has become.

PBMs have faced bipartisan criticism over opaque pricing, growing market power, and potential conflicts of interest when they share ownership with insurers and pharmacies. Congress enacted PBM reforms in February, including changes to how PBMs are compensated under Medicare Part D. At the state level, Arkansas and Tennessee have passed laws that would prohibit PBMs from owning pharmacies, according to Managed Healthcare Executive^®.³

“Aetna, CVS Caremark, and CVS Specialty, along with our value-based care and in-home health businesses, will advance together as a leading healthcare solutions provider, delivering differentiated, comprehensive benefits to clients, members, and patients,” said Joyner.¹ “CVS Pharmacy will build on its position as America’s leading retail pharmacy, serving as the front door to health and care in our country as the most frequently accessed consumer health touchpoint. Both companies will continue to advance innovative technology solutions to improve the healthcare experience as we deliver on our purpose to simplify healthcare, one person, one family, and one community at a time.”

References

1. CVS Health announces intent to create two distinct leaders in healthcare. News release. CVS Health. November 4, 2026. Accessed November 4, 2026. https://www.cvshealth.com/news/company-news/cvs-health-announces-intent-to-create-two-distinct-leaders-in-healthcare.html
2. Constantino AK. CVS to split off drugstore business. CNBC. November 4, 2026. Accessed November 4, 2026. https://www.cnbc.com/2026/11/04/cvs-to-split-off-drugstore-business.html
3. Wehrwein P. CVS Health is splitting in two, according to news reports. Managed Healthcare Executive. November 3, 2026. Accessed November 4, 2026. https://www.managedhealthcareexecutive.com/view/cvs-health-split-in-two