Fortune Global 500 · Daily Insight | Day 09 | CVS Health: Ranked #9 Globally—Why Would a Pharmacy Acquire an Insurance Company, a PBM, and Clinics?

This understanding is only partially correct. In the 2026 Fortune Global 500 ranking, CVS Health ranks #9 globally with $402.067 billion in revenue—just under $800 million less than Alphabet. Yet its 2025 net profit stood at only $1.768 billion. By comparison, Alphabet—also generating revenue in the $400 billion range—earned $132.17 billion in net profit, over 74 times more than CVS Health. [1] This disparity isn’t due to CVS merely operating on razor-thin pharmacy margins. What truly merits examination is how CVS has integrated several of the most critical nodes of the U.S. healthcare system under one corporate roof: Aetna handles insurance payments; CVS Caremark manages pharmacy benefits; CVS Pharmacy fulfills prescriptions and operates retail pharmacies; and MinuteClinic, Oak Street Health, and Signify Health extend services into clinical care, primary care, and home-based healthcare. [2] Thus, the central question for understanding CVS Health isn’t “Why is this pharmacy so large?” but rather: When a single company simultaneously controls *who pays*, *which drugs are covered*, *where patients fill prescriptions*, and *where they receive medical care*, is it still a retail company—or has it become healthcare infrastructure itself? That is the core issue this article seeks to explore. I. Global Positioning: Ranked #9—but It Is No Longer Just a “Pharmacy Company” Sources: [1][2][3] Judged solely by Fortune’s rankings, CVS Health appears to be a rather “odd” company. Its revenue scale rivals that of Alphabet, yet it lacks the global brand recognition of Google or YouTube; it operates nearly 9,000 retail locations, yet its true value lies far beyond those storefronts. [2] In 2025, CVS’s Pharmacy & Consumer Wellness business filled approximately 1.8 billion prescriptions (annualized to 30-day equivalents), accounting for roughly 28.5% of all retail pharmacy prescriptions in the U.S. Meanwhile, CVS Caremark ranks among the largest PBMs in the country, and Aetna serves as a major commercial health insurer and Medicare Advantage platform. [2] By Q2 2026, CVS Health reported quarterly revenue of $106.1 billion and net income of approximately $2.995 billion. Notably, its insurance business—which had drawn significant market skepticism over the past two years—has begun showing clear signs of recovery: the Health Care Benefits segment’s adjusted operating profit rose 85.5% year-on-year, while its medical loss ratio (MLR) improved from 89.9% to 87.4%. [3] These figures reveal two key points. First, CVS’s scale is not simply about having many pharmacies—it reflects the fact that vast volumes of prescriptions, insurance members, pharmacy benefits, and healthcare services all flow through its integrated system.

PBM: Will the high-list-price, high-rebate model come to an end?

As U.S. hospital revenues rebound and net profits turn positive again, commercial health insurers’ medical loss ratios (MLRs) have risen sharply from their lows—exerting significant pressure on insurers’ bottom lines. In response, large commercial insurers are pursuing dual strategies: controlling MLRs (primarily by negotiating with providers) and squeezing suppliers—especially pharmacy benefit managers (PBMs). Recently, Blue Shield of California (BSCA) announced that, starting in 2024, it would no longer outsource its entire PBM function to CVS alone. Instead, it will split the work across five specialized vendors. While CVS Caremark retains its specialty pharmacy business—the largest component—entry by new players introduces uncertainty regarding CVS’s future market share. On the day the announcement was made, CVS’s stock fell 8%; shares of the other two major PBMs—UnitedHealth Group and Cigna—declined 2% and 6%, respectively. Typically, insurers award all PBM-related functions—including formulary management, claims processing, and drug pricing negotiations—to a single vendor. BSCA’s decision to disaggregate and outsource these functions across multiple partners is highly unusual; whether this approach becomes an industry trend remains to be seen. Specifically, Amazon Pharmacy will handle prescription delivery and provide free pharmacist consultations; Mark Cuban Cost Plus Drug will implement a simple, transparent, and affordable pricing model—reducing opacity around drug prices at retail pharmacies. Abarca will manage prescription claims adjudication; Prime Therapeutics will lead drug price negotiations, emphasizing value-based pricing. CVS Caremark will continue providing specialty pharmacy services, patient education, and high-touch support for complex patients. BSCA’s disaggregation strategy pursues three goals: cost reduction, operational efficiency gains, and exploration of innovative procurement models. First, regarding cost reduction: According to BSCA CEO Paul Markovich, who shared data in a media interview, implementing this plan in 2025 will save over $500 million. Given that CVS Caremark commands roughly one-third of the U.S. PBM market—and thus wields strong bargaining power with payers—the bundled PBM service fees it charges are relatively high. Smaller alternative vendors, by contrast, lack such scale, giving insurers greater leverage as buyers—and enabling them to negotiate more favorable pricing. Breaking it down by category: CVS CarePass membership includes free prescription delivery; individual consumers pay just $48/year, while enterprise clients likely pay even less. Amazon Prime membership costs $139/year—far more than CVS’s offering—yet BSCA’s switch signals that Amazon holds a distinct price advantage specifically in prescription delivery. Mark Cuban Cost Plus Drug Company, founded in 2022, aims to deliver affordable medications. Its business model involves contracting directly with pharmaceutical manufacturers and selling drugs online to patients—enabling deeper discounts. Its most notable initiative is partnering with Coherus to market Yusimry, a low-cost biosimilar to Humira—highlighting its commitment to price transparency and affordability.

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