CVS announced Wednesday that it will stop selling tobacco products nationwide by Oct. 1, reported USA Today.
The move is expected to cost the company $2 billion annually, but is part of a plan to change its image from drugstore to healthcare provider. “Selling tobacco is very inconsistent with being in that business,” CVS President Helena Foulkes told USA Today.
The decision is part of a larger strategy to cut costs to insurers and health-providers, likely in order to strengthen existing alliances and gain a competitive advantage in forming new ones.
A smoking cessation program will be announced in the spring, and Foulkes said other measures will be taken including an increased focus on the company’s pharmacy management benefit program.
Rising costs expected as the Affordable Care Act is implemented played a role in the decision. “It’s expensive to provide health care for all the people through the ACA,” said Troy Brennan, company chief medical officer.
Other pharmacies are expected to follow CVS’ lead, and some cities in California and Massachusetts have banned the sale of tobacco products at all pharmacies.