CVS plans to split in two, spinning off 9,000 pharmacies by 2028

CVS Health is taking an axe to itself. The healthcare giant said Wednesday it will split into two publicly traded companies by early 2028 — one of the biggest corporate breakups ever attempted. One half keeps the CVS Health name and stays under CEO David Joyner. The other walks out on its own.

The fault line runs right through the company's core. Roughly 9,000 retail pharmacies land on one side. On the other: the Aetna insurance business, pharmacy benefit manager Caremark — one of the nation's three largest PBMs — plus primary care chain Oak Street Health, home-visit provider Signify Health and the specialty drug business. That grouping was spelled out by the company itself. It all unravels the vertically integrated machine CVS assembled in 2018 and undoes the $78 billion Aetna deal that built it.

The money tells the story of two very different businesses. CVS's pharmacy arm pulled in $37.66 billion in 2025 sales, while the insurance unit booked $36.29 billion in revenue and healthcare services generated $51.24 billion. Shareholders won't have to pick a side — they'll own stock in both companies after the split. Wall Street has already been rewarding Joyner, sending shares up roughly 70% since he took the helm in October 2024 and pushing the company's market value to $117 billion.

Analysts didn't see it coming. Leerink Partners' Michael Cherny called the split a complete shock in a Tuesday note, according to CNBC — the Financial Times first reported the plans Tuesday. Still, he argued the retail pharmacy side is in good shape: it's grabbing market share from rivals and gross margins are stabilizing thanks to CostVantage, the reimbursement model CVS rolled out last year. In that light, he wrote, a standalone pharmacy chain may be stronger now than it was before. Cherny also floated a second motive: dodging relentless state scrutiny of how tightly CVS knits its pharmacies, insurers and PBM together.

That scrutiny isn't going anywhere. PBMs face bipartisan heat in Washington and in statehouses over opaque pricing, growing market power and conflicts of interest when they sit inside companies that also run insurers and pharmacies. Congress passed PBM reforms in February, including changes to how PBMs get paid under Medicare Part D, and states are increasingly moving to restrict PBM pharmacy ownership. CVS has also been weighing this for a while — it brought in advisors for a strategic review in October 2024 and considered a retail-insurance breakup then. Now the turnaround is doing the talking: $2 billion in planned cost cuts, store closures, leadership shakeups and a tighter grip on Medicare Advantage costs.