Mass administration of COVID-19 vaccines and tests and surging consumer demand for over-the-counter retail pharmacy products lifted CVS Health’s revenues by double digits in the third quarter of 2021.
In financial results released Wednesday morning, the Woonsocket, Rhode Island-based health services conglomerate and corporate parent of Hartford’s Aetna said revenues climbed from $67 billion to $73.7 billion, or 10%, on a quarter-to-quarter basis. Net income reached $1.5 billion, or $1.20 per share, between July and September, up from $1.2 billion, or 93 cents per share, in the corresponding period one year ago.
Company officials attributed the quarterly gains to the administration of more than 8 million COVID-19 tests and 11 million vaccines, as well as increased prescription and front-store volume and improved purchasing economics. Income rose across all of CVS Health’s business segments, staving off pharmacy reimbursement pressures and price compression.
Demand for over-the-counter coronavirus testing kits in CVS retail stores was particularly strong, signalling a shift away from reliance on COVID-19 screenings in hospital and clinic settings, as was typical in the early months of the pandemic, and toward consumer-driven testing. COVID-19 vaccinations, diagnostic testing and over-the-counter test kit sales made up approximately 40% of the year-over-year increase in revenues in CVS’s retail and long-term care segment.
Also bolstering the company’s health care benefits business was the August launch of Aetna Virtual Primary Care, which expands remote health care options for eligible members.
The program gives customers access to a panel of board-certified physicians, biometric screenings, care management for chronic conditions, a virtual nurse care team reachable by phone call or text message and existing Aetna virtual care offerings, such as mental health and dermatology services and urgent care.
CVS is also in the midst of a hiring spree, having brought on thousands of new workers despite a historically tight labor market. The company is on track to raise its minimum wage to $15 an hour by July 2022.
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