CVS Purchases MinuteClinic for Reported $170 Million

The Minnesota model of quick-service clinics in retail stores soon will be popping up with greater frequency in CVS drugstores nationwide. MinuteClinic, which pioneered the market and is the largest chain of retail store-based clinics in the country, is expected to be acquired in a $170 million cash deal by CVS Corp., the country's largest drugstore chain with 6,100 retail and specialty pharmacy stores. MinuteClinic, which still is planning to triple in size to 250 locations by the end of this year. The acquisition is a sign that the fledgling retail clinic model is going mainstream. The deal will undoubtedly raise questions about how the relationship with Rhode Island-based CVS and drug sales will be handled. Nurses who staff the clinics use software that suggests drugs for patients and the software emphasizes the use of generic drugs. And patients won't be obligated to fill their prescriptions at CVS. MinuteClinic also will continue to open stores in non-CVS locations. The key to the company’s success was a proprietary software package that included all the protocols necessary to guide nurse practitioners through the diagnosis and treatment of simple maladies such as strep throat, ear and sinus infections and pink eye, among several others. The company now commonly charges $49 to $59 for visits, with insurers picking up most of that. MinuteClinic has since seen 500,000 patients and has raised more than $50 million in financing. The transaction is expected to close this summer.  (The AMC/NOMA has been proactive on this issue as it submitted letters to the leadership of both CVS and MinuteClinic earlier this year, voicing serious concerns regarding continuity of care and potential conflicts of interest within these retail settings, among others.  For more information on the AMC/NOMA’s involvement on this topic, contact Elayne Biddlestone at 216.520.1000.)