The Target Corporation and CVS Health announced via PR Newswire Wednesday that they will begin sharing floor space at various locations in the Charlotte, N.C., market, a development that heralds an ongoing change over the next six to eight months as all 1,660 of Target's pharmacy locations become CVS-branded units.
In addition, Target's 80 pre-existing in-store health clinics will rebrand as CVS MinuteClinic locations.
Back when CVS announced its $1.9 billion acquisition of Target's pharmacy business in June, many feared the move could spark a series of similar partnerships between other grocery-store pharmacies/retailers. Those fears panned out when Walgreens and Rite Aid - the second and third-largest pharmacy chains in the U.S., after CVS - announced a $9.4 billion merger in October.
There is less competition in the market when mergers occur, meaning that retailers are no longer pressured to offer their services and merchandise at lower prices - which in turn means that consumers can expect higher prices.
The merger can also lead to a conflict of interest, The Washington Post reported when the Target-CVS merger was first announced. During a recent conference call, Target officials reportedly said they are "committed to growing prescriptions" in their stores, and expect the transaction to "improve script counts."
In light of this, "analysts fear that medical professionals staffing retail clinics could face pressure to overprescribe in order to boos their employers' bottom lines," the article adds.
However, the merger isn't entirely a bad thing for consumers. First, the merger will allow Target-CVS locations to share information about the consumers health history and prescription drugs, which could serve to minimize the risk of negative drug interactions.
Secondly, and likely most important, is convenience - a virtue that Target and CVS emphasized in another press release.
"Our heart is in every prescription we fill, and providing accessible, supportive and personalized health care is part of our DNA," Helena Foulkes, the president of CVS Pharmacy, said. "On behalf of all of us at CVS Health, I am delighted to invite Target guests to experience our innovative pharmacy care services and unique digital offerings."
