Pharma, Health Services

CVS Health shuffles leadership

The company promoted new leadership with the departure of the heads of its Pharmacy and Caremark divisions. Dr. Alan Lotvin, who spent several years heading up Caremark's specialty drug efforts, was promoted to president of CVS Caremark.

With the recent departures of two key executives, CVS Health shuffled its top leadership.

In January, CVS Pharmacy President Kevin Hourican left after he was give a CEO role for food distribution company Sysco. The company is still searching for his replacement, with CVS Health COO Jonathan Roberts leading the division in the interim.

Derica Rice, president of CVS Caremark, will leave the company in March. The former CFO of Eli Lilly, Rice came out of retirement to head up CVS’ prescription benefit management subsidiary in 2018. It’s not clear what he will do next.

“I want to thank Derica for his leadership during a period of significant growth and evolution for our PBM business, and wish him the best in his future endeavors,” CVS Health CEO Larry Merlo said in a news release. “I am confident we are driving a sea change in how our key stakeholders think about us, and how consumers partner with us to take control of their health. These new assignments will accelerate that process.”

CVS promoted three internal candidates on Wednesday, which the company said would help support its strategic growth. Dr. Alan Lotvin, executive vice president of CVS Health, was promoted to president of CVS Caremark. Lotvin has worked with CVS for eight years, spending most of that time heading up Caremark’s specialty pharmacy business.

“With the growing importance of specialty medicines and gene therapy management, he is uniquely positioned to lead the company’s next wave of growth in this area,” CVS stated in a news release.

Jonathan Mayhew was appointed to Lotvin’s previous role, as executive vice president of transformation. Mayhew most recently headed up Aetna’s national accounts and markets business. CVS promoted another executive, Alec Cunningham to serve as the COO of Aetna, where he will focus more on the company’s Medicare Advantage and government programs.

“This announcement also reflects our deep and talented bench along with the opportunities our business model creates for personal growth,” Merlo told investors during an earnings call on Wednesday. “I’m confident that we have the right leadership team in place and we are at the forefront of driving a sea change in how our key stakeholders think about us, and how consumers work with us to take control of their health.”

Since its $69 billion acquisition of Aetna, CVS has seen some of the company’s top leadership depart. In October, former Aetna CTO Claus Torp Jensen left the company to join Memorial Sloan Kettering. More recently, former Aetna CEO Mark Bertolini was cut from the company’s board as it sought to decrease the number of directors. Bertolini told the Wall Street Journal he was willing to serve on the board as the two healthcare giants continued their integration, but “the board thought otherwise.”

The two entities still have work to do to integrate, but the benefits are starting to appear in CVS’ bottom line. The company reported revenues of $256.8 billion for 2019, up 32 percent year-over-year, and a net income of $6.63 billion. CVS saw the largest increase in its health care benefits segment, with revenues increasing from $8.9 billion to $69.6 billion.

 

Photo credit: Justin Sullivan, Getty Images

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