CVS Health announced plans to split into two separate publicly traded companies by mid-2028 in one of the largest corporate breakups in recent history. This restructuring will unwind the company's 2018 $78 billion acquisition of insurer Aetna, effectively dismantling the integrated healthcare business model CVS had built over nearly a decade. The split will separate CVS’ network of about 9,000 retail pharmacies from its insurance and pharmacy benefit management (PBM) operations, which include Caremark—a major player in the PBM sector.

The decision followed a thorough strategic review by CVS’s board and reflects confidence in the company’s current business health, according to CEO David Joyner. Despite shares dropping over 12% immediately after the announcement, Joyner described the move as being made “from a position of strength,” highlighting solid performance in both the Medicare segment of Aetna’s business and the retail pharmacy division. CVS has also been implementing a turnaround plan since October 2024, focusing on cost reductions, store closures, leadership changes, and better control of Medicare Advantage expenses.

Under the breakup, the insurance and PBM business will keep the CVS Health name with Joyner continuing as CEO. The pharmacy unit will be rebranded as CVS Pharmacy and led by Prem Shah, currently group president of CVS Health. Existing shareholders will own stakes in both entities, which will operate independently with separate leadership and boards. In 2025, CVS’s pharmacy operations generated $37.66 billion in revenue, while the insurance and health services segments brought in $36.29 billion and $51.24 billion respectively.

The split aims to allow each new company to pursue more focused strategies, enhance innovation, and improve operational efficiencies. It also responds to growing regulatory scrutiny over vertical integration in the pharmacy and insurance sectors, with recent state laws challenging co-ownership of PBMs and pharmacies. CVS plans to maintain business synergies through commercial agreements, even as oversight and pressure mount on PBMs for pricing transparency and market influence. The company's strong recent earnings and ongoing strategic shifts underscore confidence in successfully navigating these changes.