CVS shares slide after cuts to its full-year profit expectations

 
Billy Bambrough
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CVS sales are under pressure from cheaper rivals
CVS sales are under pressure from cheaper rivals (Source: Getty)

US pharmacy chain CVS Health has cut its full-year profit forecast, sending shares lower in New York.

The company blamed the cuts on slowing prescription growth and said it expected to lose more than 40m retail prescriptions in 2017. The loss of contracts to rivals – including one for the US military – has dragged on its outlook.

CVS rival Walgreens Boots Alliance as well as smaller independent pharmacies have been enticing customers away with lower prices.

In September CVS lost a contract to fill prescriptions through the Tricare pharmacy network to Walgreens as well as one to Prime Therapeutics.

For its third quarter CVS net sales rose 15.5 per cent to $44.6bn (£36bn), while profit rose to $1.54bn, or $1.43 per share, missing expectations.

“Very recent pharmacy network changes in the marketplace are expected to cause some retail prescriptions to begin migrating out of our pharmacies,” said chief executive Larry Merlo.

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