CVS Elevates Pharmacy Division Leader

CVS Caremark CEO David Joyner has been elevated to the head of CVS Health, replacing Karen Lynch.

“CVS also withdrew its 2024 profit forecast and advised investors against relying on the full-year guidance provided in August, citing higher medical cost pressures,” according to CNN Business. “Stock prices have dropped nearly 20% this year and fell sharply following the announcement. The shakeup comes after a particularly challenging year for the company, marked by plummeting shares, sluggish growth and pressure from investors, among a litany of other woes.”

Roger Farah, the chairman of CVS Health, said in a statement on Friday that “the board believes this is the right time to make a change.” He added that Joyner’s “deep understanding of our integrated business” would help steer the company through its challenges.

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"During his tenure at Caremark, which he rejoined in 2023 after a few years away from the company, Joyner faced increased scrutiny of pharmacy benefit managers," according to The New York Times. "He appeared at a Congressional hearing this summer, facing questions from lawmakers about the role of pharmacy benefit managers in rising drug costs for millions of Americans."

Lynch’s rise from her childhood in Ware to the corner office ended after three years. The company’s efforts to change course haven’t done much to reassure investors. The stock fell 9.4% Friday. It is now down nearly 27% this year.

“CVS sits at the intersection of three troubled industries. In retail pharmacy, tumbling reimbursements from pharmacy-benefit managers have put all the major chains into crisis,” according to Barron’s. “Washington policymakers have the PBMs, another major part of the company, in their sights, and a crackdown seems imminent. The biggest and most acute problems, however, are in managed care, where patients have been seeking far more medical services than anticipated. That trend has wreaked havoc across the sector this year.”

During her time at the helm, Lynch often placed her complicated family history at the center of her argument for why she wanted to reinvent the way that health care is delivered in America.

“Lynch regularly told the story of her traumatic youth with a vulnerability uncharacteristic of most corporate leaders,” according to The Boston Globe. “Her mother’s suicide and the death of her aunt from cancer shaped her life. She hoped sharing their stories would help drive home the vision behind her push to make CVS a single point of care for patients whose full needs might otherwise go unmet. With better care, Lynch said, both women may have lived longer.”

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