Target will sell pharmacy, clinic businesses to CVS Health for $1.9B

Associated Press

Target will sell its pharmacy and clinic businesses to CVS Health in the latest twist behind a push from big retailers to become all things to all customers.

The nation’s second-largest drugstore chain will pay about $1.9 billion to run Target’s in-store health operations and expand what they offer for customers who have come to expect that they will be able to fill a prescription when they shop at Target.

Drugstores, grocers and big retailers such as Target and Wal-Mart all have been pushing into one another’s turf for several years now, blurring traditional retail boundaries, as they try to attract customers who want to make fewer stops when they go shopping.

The number of stores the average consumer visits over a month has dropped 15 percent over the past five years, according to market researcher NPD Group.

“In other words, they’re not running from place to place to place like they used to,” said Marshal Cohen, NPD’s chief retail industry analyst. “It doesn’t mean I am shopping less, it just means I am going to less stores.”

In response, retailers have been adding clinics and pharmacies. Drugstores, in turn, have started stocking groceries.

All these businesses are chasing health care dollars as they watch baby boomers grow older and start using the health care system more and as the number of insured people climbs due to the health care overhaul.