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Earlier this year, we published an abstract in which we described plans announced by the national drug store chain CVS to phase out all sales of tobacco products and instead work more closely with health care providers to serve as their pharmacy of choice for various systems. At the time, CVS predicted revenue losses of about $2 billion, and we asked you to weigh in on whether the choice was the right one.

For CVS, the choice was both a moral and a strategic decision. The company struggled to reconcile its desired positioning as a health care company with its continued sale of tobacco. And CVS clearly has remained confident in its decision, because a month earlier than it anticipated, it removed the last remaining nicotine products from its shelves.

With the inventory shift, the chain also undertook a rebranding to become CVS Health. An in-store campaign featured “Ready to quit?” posters, in partnership with the American Lung Association. Furthermore, the company promised to continue working to expand its walk-in clinic services and pharmacy management practices.

African pharmacist looking at bottle on shelfBut all these months later, CVS still remains alone in its choice. No other major drug store chains have followed suit, nor have grocers such as Walmart and Kroger. The largest drug store chain in the nation, Walgreens released a statement in which it claimed that retail drug stores were responsible for a mere 4 percent of the tobacco sold, so eliminating the products from its shelves “would have little to no significant impact on actually reducing the use of tobacco.”

Source:Tom Ryan, “Should CVS’s Competitors Also Say Bye to Tobacco?” Retail Wire, September 9, 2014

Discussion Question

1.       Why did CVS stop selling tobacco?

2.       Should pharmacies sell tobacco?

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