In February, CVS — one of the nation’s largest pharmacy chains — announced that it would take tobacco products off the shelves of its 7,600 locations effective Oct. 1 of this year. The move is expected to cost the company $2 billion in annual sales.
What could possibly encourage a company to do such a thing? Company spokesmen have said that CVS is in the business of providing healthcare, and selling cigarettes at such a facility is detrimental to that mission — cigarettes and healthy living don’t mix.
Shortly after the announcement, the pharmacy received a proverbial pat on the back from President Barack Obama, himself a former smoker. The president lauded the company for doing something that he said would have a profoundly positive effect on the health of the citizens of the United States.
But What About Junk Food?
While the pharmacy’s move received widespread support, it was not without its detractors. After all, if CVS was really genuine about caring about the health of their customers and being a consummate healthcare provider, why would they still peddle mountains of candy, chips, soda and ice cream? And that’s not to mention the alcohol that’s available at some of the company’s locations as well.
Recent research indicates that the number of American adults who smoke is down substantially over the past 50-some-odd years. According to Reuters, only 18 percent of them smoke today, whereas 43 percent of adults smoked in 1965. With the rise of electronic cigarettes — where smokers inhale nicotine vapor rather than carcinogenic-laden smoke — one could expect even fewer people will smoke in the future. Is CVS assuming that the number of smokers will continue to dwindle and, therefore, deciding to capitalize on a ton of free press before it’s too late?
Either way, even a smoker would be likely to tell you that his or her habit is a bad one. And under our system of capitalism, companies are allowed to do whatever they want within the scope of the law to stay profitable.
After all, businesses exist to make money. It’s not hard for the cynic to argue that while CVS’ decision taken at face value is a good one — smoking is bad! — it’s likely that the company has ulterior motives and is, in fact, betting on making more money in the long run because of this.
With a network of 800 in-store clinics in 28 states, CVS is already in a prime position to benefit from those who will be newly insured under the Affordable Care Act. The company plans on opening up an additional 700 such clinics by 2017.
And because pharmacies are essential to delivering healthcare, CVS’ detractors could make the argument that the pharmacy is trying to make a move to better the relationships it already has with doctors and hospitals, agreeing to larger deals that will help CVS profit more substantially in the future. Under the new law, for example, doctors can opt to be paid not by the services they perform but instead based on how their patients fare after treatment. If CVS helps improve patients’ health following treatment, it’s likely the pharmacy could profit from such involvement.
A Selfless Statement or a Headline Grabber?
Is it possible the pharmacy chain decided to forego 1.6 percent of its annual revenue because it arrived at a philosophical conclusion and decided to make a bold statement? Or was that bold statement made simply to grab headlines and get people talking?
We’re curious to hear what you have to say about CVS’ noteworthy decision. What do you think? Should CVS and other drug stores stop selling tobacco products? Sound off in the comments below!