CVS Health to Separate Drugstore Business in Major Restructuring

CVS Health plans to split its drugstore business from its insurance and pharmacy benefits divisions by the first half of 2028, reversing its 2018 acquisition of Aetna. The decision, reached after a strategic review, will create two publicly traded companies: one encompassing the insurance, pharmacy benefits manager (PBM) Caremark, and primary/home care services, and another consisting of roughly 9,000 retail pharmacies branded as CVS Pharmacy. CEO David Joyner described the split as occurring “out of a position of strength,” citing recovery in Aetna’s Medicare business and solid performance in the retail pharmacy, despite a recent 11% drop in CVS shares following the announcement. In 2025, the pharmacy business generated $37.66 billion in sales, while the insurance unit booked $36.29 billion in revenue and healthcare services generated $51.24 billion. Total sales climbed to $108.40 billion in the third quarter, boosted by growth in health care benefits and services, even as pharmacy services revenue declined year-over-year. The company is pursuing $2 billion in cost cuts, store closures, and leadership changes as part of this turnaround. Joyner will lead the insurance and PBM company, retaining the CVS Health name, while Prem Shah, currently group president of CVS Health, will lead the new CVS Pharmacy company. The move dismantles the vertically integrated healthcare model CVS has pursued for two decades.

CVS will combine its insurer and PBM with primary care business Oak Street Health, home-visit provider Signify Health, and its specialty drug business. The split is intended to allow both companies to focus on their respective areas, according to CVS.

Where they differ

• CNBC emphasized the 11% drop in CVS shares following the announcement, while the New York Times did not highlight the immediate market reaction.
• CNBC detailed the aggressive turnaround plan under CEO David Joyner, including specific cost-cutting measures and leadership changes, while the New York Times provided a broader overview of the restructuring.
• The New York Times framed the split as ending CVS’s “bigger-is-better era,” a characterization not present in the CNBC report.

What is not yet known

• The specific details of the leadership positions and board members for the new companies will be announced at a later date.
• The exact allocation of existing CVS shareholders’ shares in both companies after the split remains to be determined.

Background

• CVS Health acquired Aetna in 2018, creating a vertically integrated healthcare model, which is now being dismantled [Fact Refinery, 2026-11-03].
• In 2025, CVS Pharmacy generated $37.66 billion in sales, while the insurance unit booked $36.29 billion in revenue [Fact Refinery, 2026-11-03].
• CVS Pharmacy was subject to a Justice Department lawsuit in 2024 alleging unlawful dispensing of opioids, resulting in a $315 million settlement in 2026 [Fact Refinery, 2026-10-13].
• Healthcare companies are increasingly experimenting with multi-cancer blood tests to improve early diagnosis, as demonstrated by the NHS trial in England [Fact Refinery, 2026-11-04].

Our reading

Our reading is that CVS Health is attempting to reposition itself after a period of ambitious integration, acknowledging market skepticism signaled by the recent drop in share price. The company seems to be prioritizing distinct performance for its insurance/PBM and retail pharmacy divisions, suggesting a belief that these segments will be more valuable operating independently. The emphasis on “strength” and cost-cutting indicates a desire to reassure investors despite the significant restructuring.

What to watch

• The specific details of share allocation to existing shareholders after the split, expected to be announced at a later date [Fact Refinery, 2026-11-03].
• The performance of CVS Health shares in the months following the announcement, to gauge investor confidence in the restructuring [CNBC, 2026-11-03].
• The timeline and execution of the $2 billion in cost cuts and store closures, as detailed by CEO David Joyner [CNBC, 2026-11-03].

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