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Delaware
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05-0494040
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(State of Incorporation)
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(I.R.S. Employer Identification Number)
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Large accelerated filer [X]
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Accelerated filer [ ]
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Non-accelerated filer [ ] (Do not check if a smaller reporting company)
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Smaller reporting company [ ]
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Page
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Item 1.
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Financial Statements
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Part I
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Item 1
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Three Months Ended September 30,
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|
Nine Months Ended September 30,
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||||||||||||
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In millions, except per share amounts
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2015
|
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2014
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2015
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2014
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||||||||
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||||||||
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Net revenues
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$
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38,644
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$
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35,021
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$
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112,144
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$
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102,312
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|
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Cost of revenues
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31,983
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28,553
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92,917
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83,578
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||||
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Gross profit
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6,661
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6,468
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19,227
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18,734
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||||
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Operating expenses
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4,330
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4,222
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12,502
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12,256
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||||
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Operating profit
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2,331
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2,246
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6,725
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6,478
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||||
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Interest expense, net
|
261
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153
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|
562
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469
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||||
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Loss on early extinguishment of debt
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—
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521
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|
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—
|
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521
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||||
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Income before income tax provision
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2,070
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|
|
1,572
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|
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6,163
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|
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5,488
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||||
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Income tax provision
|
833
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624
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2,433
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2,165
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||||
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Income from continuing operations
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1,237
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|
948
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3,730
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|
|
3,323
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||||
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Income from discontinued operations, net of tax
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10
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|
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—
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10
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—
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||||
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Net income
|
1,247
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|
|
948
|
|
|
3,740
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|
|
3,323
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||||
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Net income attributable to noncontrolling interest
|
(1
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)
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—
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(1
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)
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—
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||||
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Net income attributable to CVS Health
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$
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1,246
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|
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$
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948
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$
|
3,739
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|
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$
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3,323
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Basic earnings per share:
|
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Income from continuing operations attributable to CVS Health
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$
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1.10
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$
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0.82
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$
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3.31
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$
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2.84
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Income from discontinued operations attributable to CVS Health
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$
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0.01
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$
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—
|
|
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$
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0.01
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|
|
$
|
—
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Net income attributable to CVS Health
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$
|
1.11
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|
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$
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0.82
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$
|
3.32
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|
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$
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2.84
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|
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Weighted average basic shares outstanding
|
1,114
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1,157
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1,122
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1,167
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||||
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Diluted earnings per share:
|
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||||||||
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Income from continuing operations attributable to CVS Health
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$
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1.10
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$
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0.81
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$
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3.28
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|
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$
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2.82
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Income from discontinued operations attributable to CVS Health
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$
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0.01
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$
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—
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$
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0.01
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$
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—
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Net income attributable to CVS Health
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$
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1.11
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$
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0.81
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$
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3.29
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$
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2.82
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Weighted average diluted shares outstanding
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1,121
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1,164
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1,130
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1,175
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Dividends declared per share
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$
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0.350
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$
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0.275
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$
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1.050
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$
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0.825
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Three Months Ended September 30,
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Nine Months Ended September 30,
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||||||||||||
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In millions
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2015
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2014
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2015
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2014
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||||||||
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||||||||
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Net income
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$
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1,247
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$
|
948
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$
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3,740
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$
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3,323
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Other comprehensive income (loss):
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||||
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Foreign currency translation adjustments, net of tax
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(61
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)
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(29
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)
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(100
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)
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(14
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)
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||||
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Cash flow hedges, net of tax
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—
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1
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1
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3
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||||
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Total other comprehensive income (loss)
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(61
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)
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(28
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)
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(99
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)
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(11
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)
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||||
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Comprehensive income
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1,186
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|
920
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3,641
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3,312
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||||
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Comprehensive income attributable to noncontrolling interest
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(1
|
)
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—
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(1
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)
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—
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||||
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Comprehensive income attributable to CVS Health
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$
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1,185
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$
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920
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$
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3,640
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$
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3,312
|
|
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In millions, except per share amounts
|
September 30,
2015 |
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December 31,
2014 |
||||
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||||
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Assets:
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|
|
|
||||
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Cash and cash equivalents
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$
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2,890
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$
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2,481
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|
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Short-term investments
|
121
|
|
|
34
|
|
||
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Accounts receivable, net
|
12,804
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|
|
9,687
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|
||
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Inventories
|
13,282
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|
|
11,930
|
|
||
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Deferred income taxes
|
1,077
|
|
|
985
|
|
||
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Other current assets
|
579
|
|
|
866
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|
||
|
Total current assets
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30,753
|
|
|
25,983
|
|
||
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Property and equipment, net
|
9,494
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|
|
8,843
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|
||
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Goodwill
|
37,135
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|
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28,142
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|
||
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Intangible assets, net
|
13,504
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|
|
9,774
|
|
||
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Other assets
|
1,476
|
|
|
1,445
|
|
||
|
Total assets
|
$
|
92,362
|
|
|
$
|
74,187
|
|
|
|
|
|
|
||||
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Liabilities:
|
|
|
|
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|
||
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Accounts payable
|
$
|
7,064
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|
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$
|
6,547
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|
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Claims and discounts payable
|
7,283
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|
|
5,404
|
|
||
|
Accrued expenses
|
6,636
|
|
|
5,816
|
|
||
|
Short-term debt
|
—
|
|
|
685
|
|
||
|
Current portion of long-term debt
|
451
|
|
|
575
|
|
||
|
Total current liabilities
|
21,434
|
|
|
19,027
|
|
||
|
Long-term debt
|
26,771
|
|
|
11,630
|
|
||
|
Deferred income taxes
|
5,449
|
|
|
4,036
|
|
||
|
Other long-term liabilities
|
1,528
|
|
|
1,531
|
|
||
|
Commitments and contingencies (Note 13)
|
—
|
|
|
—
|
|
||
|
|
|
|
|
||||
|
Shareholders’ equity:
|
|
|
|
|
|
||
|
CVS Health shareholders’ equity:
|
|
|
|
||||
|
Preferred stock, par value $0.01: 0.1 share authorized; none issued or outstanding
|
—
|
|
|
—
|
|
||
|
Common stock, par value $0.01: 3,200 shares authorized; 1,698 shares issued and 1,110
|
|
|
|
||||
|
shares outstanding at September 30, 2015 and 1,691 shares issued and 1,140 shares
|
|
|
|
||||
|
outstanding at December 31, 2014
|
17
|
|
|
17
|
|
||
|
Treasury stock, at cost: 587 shares at September 30, 2015 and 550 shares at December 31,
|
|
|
|
||||
|
2014
|
(27,899
|
)
|
|
(24,078
|
)
|
||
|
Shares held in trust: 1 share at September 30, 2015 and December 31, 2014
|
(31
|
)
|
|
(31
|
)
|
||
|
Capital surplus
|
31,005
|
|
|
30,418
|
|
||
|
Retained earnings
|
34,398
|
|
|
31,849
|
|
||
|
Accumulated other comprehensive income (loss)
|
(316
|
)
|
|
(217
|
)
|
||
|
Total CVS Health shareholders’ equity
|
37,174
|
|
|
37,958
|
|
||
|
Noncontrolling interest
|
6
|
|
|
5
|
|
||
|
Total shareholders’ equity
|
37,180
|
|
|
37,963
|
|
||
|
Total liabilities and shareholders’ equity
|
$
|
92,362
|
|
|
$
|
74,187
|
|
|
|
Nine Months Ended September 30,
|
||||||
|
In millions
|
2015
|
|
2014
|
||||
|
Cash flows from operating activities:
|
|
|
|
||||
|
Cash receipts from customers
|
$
|
108,324
|
|
|
$
|
95,816
|
|
|
Cash paid for inventory and prescriptions dispensed by retail network pharmacies
|
(89,530
|
)
|
|
(77,067
|
)
|
||
|
Cash paid to other suppliers and employees
|
(11,240
|
)
|
|
(11,267
|
)
|
||
|
Interest received
|
15
|
|
|
11
|
|
||
|
Interest paid
|
(423
|
)
|
|
(458
|
)
|
||
|
Income taxes paid
|
(2,305
|
)
|
|
(2,321
|
)
|
||
|
Net cash provided by operating activities
|
4,841
|
|
|
4,714
|
|
||
|
|
|
|
|
||||
|
Cash flows from investing activities:
|
|
|
|
|
|
||
|
Purchases of property and equipment
|
(1,490
|
)
|
|
(1,436
|
)
|
||
|
Proceeds from sale-leaseback transactions
|
34
|
|
|
328
|
|
||
|
Proceeds from sale of property and equipment and other assets
|
28
|
|
|
8
|
|
||
|
Acquisitions (net of cash acquired) and other investments
|
(9,503
|
)
|
|
(2,392
|
)
|
||
|
Purchase of available-for-sale investments
|
(184
|
)
|
|
(161
|
)
|
||
|
Sales/maturities of available-for-sale investments
|
115
|
|
|
119
|
|
||
|
Net cash used in investing activities
|
(11,000
|
)
|
|
(3,534
|
)
|
||
|
|
|
|
|
||||
|
Cash flows from financing activities:
|
|
|
|
|
|
||
|
Increase (decrease) in short-term debt
|
(685
|
)
|
|
775
|
|
||
|
Proceeds from issuance of long-term debt
|
14,808
|
|
|
1,483
|
|
||
|
Repayments of long-term debt
|
(2,898
|
)
|
|
(3,086
|
)
|
||
|
Dividends paid
|
(1,185
|
)
|
|
(971
|
)
|
||
|
Proceeds from exercise of stock options
|
277
|
|
|
378
|
|
||
|
Excess tax benefits from stock-based compensation
|
132
|
|
|
89
|
|
||
|
Repurchase of common stock
|
(3,871
|
)
|
|
(2,801
|
)
|
||
|
Other
|
(2
|
)
|
|
—
|
|
||
|
Net cash provided by (used in) financing activities
|
6,576
|
|
|
(4,133
|
)
|
||
|
Effect of exchange rate changes on cash and cash equivalents
|
(8
|
)
|
|
(4
|
)
|
||
|
Net increase (decrease) in cash and cash equivalents
|
409
|
|
|
(2,957
|
)
|
||
|
Cash and cash equivalents at beginning of period
|
2,481
|
|
|
4,089
|
|
||
|
Cash and cash equivalents at end of period
|
$
|
2,890
|
|
|
$
|
1,132
|
|
|
|
|
|
|
||||
|
Reconciliation of net income to net cash provided by operating activities:
|
|
|
|
|
|
||
|
Net income
|
$
|
3,740
|
|
|
$
|
3,323
|
|
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
||
|
Depreciation and amortization
|
1,510
|
|
|
1,442
|
|
||
|
Stock-based compensation
|
175
|
|
|
121
|
|
||
|
Loss on early extinguishment of debt
|
—
|
|
|
521
|
|
||
|
Deferred income taxes and other noncash items
|
(184
|
)
|
|
(64
|
)
|
||
|
Change in operating assets and liabilities, net of effects from acquisitions:
|
|
|
|
|
|
||
|
Accounts receivable, net
|
(2,530
|
)
|
|
(1,872
|
)
|
||
|
Inventories
|
(893
|
)
|
|
(449
|
)
|
||
|
Other current assets
|
591
|
|
|
(160
|
)
|
||
|
Other assets
|
(13
|
)
|
|
(19
|
)
|
||
|
Accounts payable and claims and discounts payable
|
2,038
|
|
|
1,222
|
|
||
|
Accrued expenses
|
523
|
|
|
676
|
|
||
|
Other long-term liabilities
|
(116
|
)
|
|
(27
|
)
|
||
|
Net cash provided by operating activities
|
$
|
4,841
|
|
|
$
|
4,714
|
|
|
•
|
Level 1 – Inputs to the valuation methodology are unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date.
|
|
•
|
Level 2 – Inputs to the valuation methodology are quoted prices for similar assets and liabilities in active markets, quoted prices in markets that are not active or inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the instrument.
|
|
•
|
Level 3 – Inputs to the valuation methodology are unobservable inputs based upon management’s best estimate of inputs market participants could use in pricing the asset or liability at the measurement date, including assumptions about risk.
|
|
In millions
|
|
As Previously Reported
|
|
Adjustments
|
|
As Revised
|
||||||
|
Other assets
|
|
$
|
1,510
|
|
|
$
|
(65
|
)
|
|
$
|
1,445
|
|
|
Total assets
|
|
74,252
|
|
|
(65
|
)
|
|
74,187
|
|
|||
|
Long-term debt
|
|
11,695
|
|
|
(65
|
)
|
|
11,630
|
|
|||
|
Total liabilities and shareholders’ equity
|
|
74,252
|
|
|
(65
|
)
|
|
74,187
|
|
|||
|
(in millions)
|
|
||
|
Cash paid to Omnicare shareholders
|
$
|
9,636
|
|
|
Fair value of replacement equity awards issued to Omnicare employees
|
|
||
|
for precombination services
|
9
|
|
|
|
Total consideration
|
$
|
9,645
|
|
|
(in millions)
|
|
||
|
Current assets (including cash of $298)
|
$
|
1,682
|
|
|
Property and equipment
|
314
|
|
|
|
Goodwill
|
9,035
|
|
|
|
Intangible assets
|
3,962
|
|
|
|
Other noncurrent assets
|
64
|
|
|
|
Current liabilities
|
(704
|
)
|
|
|
Long-term debt
|
(3,110
|
)
|
|
|
Deferred income tax liabilities
|
(1,533
|
)
|
|
|
Other noncurrent liabilities
|
(65
|
)
|
|
|
Total consideration
|
$
|
9,645
|
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
|
(in millions, except per share data)
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
Total revenues
|
$
|
39,374
|
|
|
$
|
36,390
|
|
|
$
|
115,652
|
|
|
$
|
106,391
|
|
|
Income from continuing operations
|
1,318
|
|
|
929
|
|
|
3,774
|
|
|
3,261
|
|
||||
|
Basic earnings per share from continuing operations
|
$
|
1.18
|
|
|
$
|
0.80
|
|
|
$
|
3.35
|
|
|
$
|
2.78
|
|
|
Diluted earnings per share from continuing operations
|
$
|
1.17
|
|
|
$
|
0.79
|
|
|
$
|
3.32
|
|
|
$
|
2.76
|
|
|
In millions
|
Pharmacy Services
|
|
Retail/LTC
|
|
Total
|
||||||
|
Balance, December 31, 2014
|
$
|
21,234
|
|
|
$
|
6,908
|
|
|
$
|
28,142
|
|
|
Acquisition
|
444
|
|
|
8,591
|
|
|
9,035
|
|
|||
|
Foreign currency translation adjustments
|
—
|
|
|
(40
|
)
|
|
(40
|
)
|
|||
|
Other
(1)
|
(1
|
)
|
|
(1
|
)
|
|
(2
|
)
|
|||
|
Balance, September 30, 2015
|
$
|
21,677
|
|
|
$
|
15,458
|
|
|
$
|
37,135
|
|
|
|
September 30, 2015
|
|
December 31, 2014
|
||||||||||||||||||||
|
In millions
|
Gross
Carrying Amount
|
|
Accumulated Amortization
|
|
Net Carrying Amount
|
|
Gross
Carrying Amount
|
|
Accumulated Amortization
|
|
Net Carrying Amount
|
||||||||||||
|
Trademarks (indefinitely-lived)
|
$
|
6,398
|
|
|
$
|
—
|
|
|
$
|
6,398
|
|
|
$
|
6,398
|
|
|
$
|
—
|
|
|
$
|
6,398
|
|
|
Customer contracts and
relationships and covenants not
to compete
|
10,536
|
|
|
(3,921
|
)
|
|
6,615
|
|
|
6,521
|
|
|
(3,549
|
)
|
|
2,972
|
|
||||||
|
Favorable leases and other
|
1,087
|
|
|
(596
|
)
|
|
491
|
|
|
880
|
|
|
(476
|
)
|
|
404
|
|
||||||
|
|
$
|
18,021
|
|
|
$
|
(4,517
|
)
|
|
$
|
13,504
|
|
|
$
|
13,799
|
|
|
$
|
(4,025
|
)
|
|
$
|
9,774
|
|
|
In millions
|
September 30, 2015
|
|
December 31, 2014
|
||||
|
Commercial paper
|
$
|
—
|
|
|
$
|
685
|
|
|
3.25% senior notes due 2015
|
—
|
|
|
550
|
|
||
|
1.2% senior notes due 2016
|
750
|
|
|
750
|
|
||
|
6.125% senior notes due 2016
|
421
|
|
|
421
|
|
||
|
5.75% senior notes due 2017
|
1,080
|
|
|
1,080
|
|
||
|
1.9% senior notes due 2018
|
2,250
|
|
|
—
|
|
||
|
2.25% senior notes due 2018
|
1,250
|
|
|
1,250
|
|
||
|
2.25% senior notes due 2019
|
850
|
|
|
850
|
|
||
|
6.6% senior notes due 2019
|
394
|
|
|
394
|
|
||
|
2.8% senior notes due 2020
|
2,750
|
|
|
—
|
|
||
|
4.75% senior notes due 2020
|
450
|
|
|
450
|
|
||
|
4.125% senior notes due 2021
|
550
|
|
|
550
|
|
||
|
2.75% senior notes due 2022
|
1,250
|
|
|
1,250
|
|
||
|
3.5% senior notes due 2022
|
1,500
|
|
|
—
|
|
||
|
4.75% senior notes due 2022
|
400
|
|
|
—
|
|
||
|
4% senior notes due 2023
|
1,250
|
|
|
1,250
|
|
||
|
3.375% senior notes due 2024
|
650
|
|
|
650
|
|
||
|
5% senior notes due 2024
|
300
|
|
|
—
|
|
||
|
3.875% senior notes due 2025
|
3,000
|
|
|
—
|
|
||
|
6.25% senior notes due 2027
|
453
|
|
|
453
|
|
||
|
3.25% senior debentures due 2035
|
4
|
|
|
—
|
|
||
|
3.25% senior exchange debentures due 2035
|
5
|
|
|
—
|
|
||
|
4.875% senior notes due 2035
|
2,000
|
|
|
—
|
|
||
|
6.125% senior notes due 2039
|
734
|
|
|
734
|
|
||
|
5.75% senior notes due 2041
|
493
|
|
|
493
|
|
||
|
5.3% senior notes due 2043
|
750
|
|
|
750
|
|
||
|
5.125% senior notes due 2045
|
3,500
|
|
|
—
|
|
||
|
Capital lease obligations
|
393
|
|
|
391
|
|
||
|
Other
|
28
|
|
|
41
|
|
||
|
Total debt principal
|
27,455
|
|
|
12,992
|
|
||
|
Debt premiums
|
45
|
|
|
—
|
|
||
|
Debt discounts and deferred financing costs
|
(278
|
)
|
|
(102
|
)
|
||
|
|
27,222
|
|
|
12,890
|
|
||
|
Less:
|
|
|
|
||||
|
Short-term debt (commercial paper)
|
—
|
|
|
(685
|
)
|
||
|
Current portion of long-term debt
|
(451
|
)
|
|
(575
|
)
|
||
|
Long-term debt
|
$
|
26,771
|
|
|
$
|
11,630
|
|
|
Interest Rate and Maturity
|
|
Aggregate Principal Amount (In Millions)
|
|
Percentage of Total Outstanding Principal Amount Exchanged
|
|||
|
4.75% senior notes due 2022
|
|
$
|
388
|
|
|
96.8
|
%
|
|
5% senior notes due 2024
|
|
296
|
|
|
98.8
|
%
|
|
|
Total senior notes issued under exchange transaction
|
|
$
|
684
|
|
|
|
|
|
Year Ending December 31:
|
|
|
|
||
|
In millions
|
|
|
|
||
|
2016
|
|
$
|
1,207
|
|
|
|
2017
|
|
1,103
|
|
|
|
|
2018
|
|
3,526
|
|
|
|
|
2019
|
|
1,262
|
|
|
|
|
2020
|
|
3,219
|
|
|
|
|
Thereafter
|
|
17,138
|
|
|
|
|
Total
|
|
$
|
27,455
|
|
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
In millions
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
Minimum rentals
|
$
|
576
|
|
|
$
|
569
|
|
|
$
|
1,721
|
|
|
$
|
1,692
|
|
|
Contingent rentals
|
9
|
|
|
9
|
|
|
25
|
|
|
26
|
|
||||
|
|
585
|
|
|
578
|
|
|
1,746
|
|
|
1,718
|
|
||||
|
Less: sublease income
|
(5
|
)
|
|
(5
|
)
|
|
(16
|
)
|
|
(16
|
)
|
||||
|
|
$
|
580
|
|
|
$
|
573
|
|
|
$
|
1,730
|
|
|
$
|
1,702
|
|
|
In billions
|
|
|
|
|
|
|
||||
|
Authorization Date
|
Authorized
|
Remaining
|
||||||||
|
December 15, 2014 (“2014 Repurchase Program”)
|
|
$
|
10.0
|
|
|
|
$
|
8.8
|
|
|
|
December 17, 2013 (“2013 Repurchase Program”)
|
|
$
|
6.0
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
$
|
8.8
|
|
|
||
|
|
Three Months Ended September 30, 2015
(1)
|
||||||||||||||
|
In millions
|
Foreign Currency
|
|
Losses on Cash Flow Hedges
|
|
Pension and Other Postretirement Benefits
|
|
Total
|
||||||||
|
Balance, June 30, 2015
|
$
|
(104
|
)
|
|
$
|
(8
|
)
|
|
$
|
(143
|
)
|
|
$
|
(255
|
)
|
|
Other comprehensive income (loss) before
reclassifications |
(61
|
)
|
|
—
|
|
|
—
|
|
|
(61
|
)
|
||||
|
Amounts reclassified from accumulated
other comprehensive income (2) |
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
|
Net other comprehensive income (loss)
|
(61
|
)
|
|
—
|
|
|
—
|
|
|
(61
|
)
|
||||
|
Balance, September 30, 2015
|
$
|
(165
|
)
|
|
$
|
(8
|
)
|
|
$
|
(143
|
)
|
|
$
|
(316
|
)
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
Three Months Ended September 30, 2014
(1)
|
||||||||||||||
|
|
Foreign Currency
|
|
Losses on Cash Flow Hedges
|
|
Pension and Other Postretirement Benefits
|
|
Total
|
||||||||
|
Balance, June 30, 2014
|
$
|
(15
|
)
|
|
$
|
(11
|
)
|
|
$
|
(106
|
)
|
|
$
|
(132
|
)
|
|
Other comprehensive income (loss) before
reclassifications |
(29
|
)
|
|
—
|
|
|
—
|
|
|
(29
|
)
|
||||
|
Amounts reclassified from accumulated
other comprehensive income (2) |
—
|
|
|
1
|
|
|
—
|
|
|
1
|
|
||||
|
Net other comprehensive income (loss)
|
(29
|
)
|
|
1
|
|
|
—
|
|
|
(28
|
)
|
||||
|
Balance, September 30, 2014
|
$
|
(44
|
)
|
|
$
|
(10
|
)
|
|
$
|
(106
|
)
|
|
$
|
(160
|
)
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
Nine Months Ended September 30, 2015
(1)
|
||||||||||||||
|
|
Foreign Currency
|
|
Losses on Cash Flow Hedges
|
|
Pension and Other Postretirement Benefits
|
|
Total
|
||||||||
|
Balance, December 31, 2014
|
$
|
(65
|
)
|
|
$
|
(9
|
)
|
|
$
|
(143
|
)
|
|
$
|
(217
|
)
|
|
Other comprehensive income (loss) before
reclassifications |
(100
|
)
|
|
1
|
|
|
—
|
|
|
(99
|
)
|
||||
|
Amounts reclassified from accumulated
other comprehensive income (2) |
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
|
Net other comprehensive income (loss)
|
(100
|
)
|
|
1
|
|
|
—
|
|
|
(99
|
)
|
||||
|
Balance, September 30, 2015
|
$
|
(165
|
)
|
|
$
|
(8
|
)
|
|
$
|
(143
|
)
|
|
$
|
(316
|
)
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
Nine Months Ended September 30, 2014
(1)
|
||||||||||||||
|
|
Foreign Currency
|
|
Losses on Cash Flow Hedges
|
|
Pension and Other Postretirement Benefits
|
|
Total
|
||||||||
|
Balance, December 31, 2013
|
$
|
(30
|
)
|
|
$
|
(13
|
)
|
|
$
|
(106
|
)
|
|
$
|
(149
|
)
|
|
Other comprehensive income (loss) before
reclassifications |
(14
|
)
|
|
—
|
|
|
—
|
|
|
(14
|
)
|
||||
|
Amounts reclassified from accumulated
other comprehensive income (2) |
—
|
|
|
3
|
|
|
—
|
|
|
3
|
|
||||
|
Net other comprehensive income (loss)
|
(14
|
)
|
|
3
|
|
|
—
|
|
|
(11
|
)
|
||||
|
Balance, September 30, 2014
|
$
|
(44
|
)
|
|
$
|
(10
|
)
|
|
$
|
(106
|
)
|
|
$
|
(160
|
)
|
|
(1)
|
All amounts are net of tax.
|
|
(2)
|
The amounts reclassified from accumulated other comprehensive income for losses on cash flow hedges are recorded within interest expense, net on the condensed consolidated statement of income. The amounts reclassified from accumulated other comprehensive income for pension and other postretirement benefits are included in operating expenses on the condensed consolidated statement of income.
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
||||||||||||
|
In millions
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
Stock-based compensation:
|
|
|
|
|
|
|
|
||||||||
|
Stock options
|
$
|
22
|
|
|
$
|
26
|
|
|
$
|
67
|
|
|
$
|
76
|
|
|
Restricted stock awards
|
65
|
|
|
18
|
|
|
108
|
|
|
45
|
|
||||
|
Total stock-based compensation
|
$
|
87
|
|
|
$
|
44
|
|
|
$
|
175
|
|
|
$
|
121
|
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
||||||||||||
|
In millions
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
Interest expense
|
$
|
268
|
|
|
$
|
158
|
|
|
$
|
577
|
|
|
$
|
480
|
|
|
Interest income
|
(7
|
)
|
|
(5
|
)
|
|
(15
|
)
|
|
(11
|
)
|
||||
|
Interest expense, net
|
$
|
261
|
|
|
$
|
153
|
|
|
$
|
562
|
|
|
$
|
469
|
|
|
|
Three Months Ended
September 30, |
|
Nine Months Ended
September 30, |
||||||||||||
|
In millions, except per share amounts
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
Numerator for earnings per share calculations:
|
|
|
|
|
|
|
|
||||||||
|
Income from continuing operations
(1)
|
$
|
1,230
|
|
|
$
|
944
|
|
|
$
|
3,711
|
|
|
$
|
3,310
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Denominators for earnings per share calculations:
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Weighted average shares, basic
|
1,114
|
|
|
1,157
|
|
|
1,122
|
|
|
1,167
|
|
||||
|
Effect of dilutive securities
|
7
|
|
|
7
|
|
|
8
|
|
|
8
|
|
||||
|
Weighted average shares, diluted
|
1,121
|
|
|
1,164
|
|
|
1,130
|
|
|
1,175
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
|
Earnings per share from continuing operations:
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Basic
|
$
|
1.10
|
|
|
$
|
0.82
|
|
|
$
|
3.31
|
|
|
$
|
2.84
|
|
|
Diluted
|
$
|
1.10
|
|
|
$
|
0.81
|
|
|
$
|
3.28
|
|
|
$
|
2.82
|
|
|
(1)
|
Comprised of income from continuing operations less net income attributable to noncontrolling interest and amounts allocable to participating securities of
$6 million
and
$4 million
for the three months ended September 30, 2015 and 2014, respectively, and
$18 million
and
$13 million
for the nine months ended
September 30, 2015
and 2014, respectively.
|
|
In millions
|
Pharmacy
Services
Segment
(1)
|
|
Retail/LTC
Segment
|
|
Corporate
Segment
|
|
Intersegment
Eliminations
(2)
|
|
Consolidated
Totals
|
||||||||||
|
Three Months Ended
|
|
|
|
|
|
|
|
|
|
||||||||||
|
September 30, 2015:
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Net revenues
|
$
|
25,528
|
|
|
$
|
17,912
|
|
|
$
|
—
|
|
|
$
|
(4,796
|
)
|
|
$
|
38,644
|
|
|
Gross profit
|
1,468
|
|
|
5,373
|
|
|
—
|
|
|
(180
|
)
|
|
6,661
|
|
|||||
|
Operating profit (loss)
(3)
|
1,162
|
|
|
1,643
|
|
|
(309
|
)
|
|
(165
|
)
|
|
2,331
|
|
|||||
|
September 30, 2014:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Net revenues
|
22,534
|
|
|
16,749
|
|
|
—
|
|
|
(4,262
|
)
|
|
35,021
|
|
|||||
|
Gross profit
|
1,403
|
|
|
5,237
|
|
|
—
|
|
|
(172
|
)
|
|
6,468
|
|
|||||
|
Operating profit (loss)
|
1,087
|
|
|
1,527
|
|
|
(196
|
)
|
|
(172
|
)
|
|
2,246
|
|
|||||
|
Nine Months Ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
September 30, 2015:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Net revenues
|
73,849
|
|
|
52,105
|
|
|
—
|
|
|
(13,810
|
)
|
|
112,144
|
|
|||||
|
Gross profit
|
3,735
|
|
|
15,990
|
|
|
—
|
|
|
(498
|
)
|
|
19,227
|
|
|||||
|
Operating profit (loss)
(3)
|
2,837
|
|
|
5,050
|
|
|
(712
|
)
|
|
(450
|
)
|
|
6,725
|
|
|||||
|
September 30, 2014:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Net revenues
|
64,566
|
|
|
50,100
|
|
|
—
|
|
|
(12,354
|
)
|
|
102,312
|
|
|||||
|
Gross profit
|
3,533
|
|
|
15,719
|
|
|
—
|
|
|
(518
|
)
|
|
18,734
|
|
|||||
|
Operating profit (loss)
|
2,605
|
|
|
4,982
|
|
|
(591
|
)
|
|
(518
|
)
|
|
6,478
|
|
|||||
|
(3)
|
The Corporate Segment operating loss includes
$115 million
and
$135 million
of acquisition-related transaction and integration costs for the three and nine months ended September 30, 2015, respectively.
|
|
•
|
Caremark (the term “Caremark” being used herein to generally refer to any one or more PBM subsidiaries of the Company, as applicable) was named in a putative class action lawsuit filed in October 2003 in Alabama state court by John Lauriello, purportedly on behalf of participants in the 1999 settlement of various securities class action and derivative lawsuits against Caremark and others. Other defendants include insurance companies that provided coverage to Caremark with respect to the settled lawsuits. The Lauriello lawsuit seeks approximately
$3.2 billion
in compensatory damages plus other non-specified damages based on allegations that the amount of insurance coverage available for the settled lawsuits was misrepresented and suppressed. A similar lawsuit was filed in November 2003 by Frank McArthur, also in Alabama state court, naming as defendants, among others, Caremark and several insurance companies involved in the 1999 settlement. This lawsuit was stayed as a later-filed class action, but McArthur was subsequently allowed to intervene in the Lauriello action. Following the close of class discovery, the trial court entered an Order on August 15, 2012 that granted the plaintiffs’ motion to certify a class pursuant to Alabama Rule of Civil Procedures 23(b)(3) but denied their request that the class also be certified pursuant to Rule 23(b)(1). In addition, the August 15, 2012 Order appointed class representatives and class counsel. On September 12, 2014, the Alabama Supreme Court affirmed the trial court’s August 15, 2012 Order. The case is proceeding and trial is currently scheduled to begin in February 2016.
|
|
•
|
Beginning in August 2003, various lawsuits were filed by pharmacies alleging that Caremark and other PBMs were violating certain antitrust laws. In August 2003, Bellevue Drug Co., Robert Schreiber, Inc. d/b/a Burns Pharmacy and Rehn-Huerbinger Drug Co. d/b/a Parkway Drugs #4, together with Pharmacy Freedom Fund and the National Community Pharmacists Association filed a putative class action against Caremark in the United States District Court for the Eastern District of Pennsylvania, seeking treble damages and injunctive relief. This case was initially sent to arbitration based on the contract terms between the pharmacies and Caremark, but later returned to federal court, where it currently remains. In addition, in October 2003,
two
independent pharmacies, North Jackson Pharmacy, Inc. and C&C, Inc. d/b/a Big C Discount Drugs, Inc., filed
three
separate putative class action complaints in the United States District Court for the Northern District of Alabama, all seeking treble damages and injunctive relief.
One
complaint named
three
Caremark entities as defendants, and the other
two
complaints named PBM competitors. The North Jackson Pharmacy case against
two
of the Caremark entities was transferred to the United States District Court for the Northern District of Illinois; the case against the third Caremark entity was sent to arbitration based on contract terms between the pharmacies and that entity. The arbitration was stayed at the parties’ request and later closed by the American Arbitration Association.
|
|
•
|
In February 2006, two substantially similar putative class action lawsuits were filed in the U.S. District Court for the Eastern District of Kentucky, and were consolidated and entitled Indiana State Dist. Council of Laborers & HOD Carriers Pension & Welfare Fund v. Omnicare, Inc.,
et al.
, No. 2:06cv26. The consolidated complaint was filed against Omnicare, three of its officers and two of its directors and purported to be brought on behalf of all open-market purchasers of Omnicare common stock from August 3, 2005 through July 27, 2006, as well as all purchasers who bought shares of Omnicare common stock in Omnicare’s public offering in December 2005. The complaint alleged violations of the Securities Exchange Act of 1934 and Section 11 of the Securities Act of 1933 and sought, among other things, compensatory damages and injunctive relief. After dismissals and appeals to the United States Court of Appeals for the Sixth Circuit, the United States Supreme Court remanded the case to the district court. In October 2015, the court granted plaintiffs’ motion to file a third amended complaint.
|
|
•
|
In December 2007, the Company received a document subpoena from the Office of Inspector General (“OIG”) within the U.S. Department of Health and Human Services, requesting information relating to the processing of Medicaid and certain other government agency claims on behalf of its clients (which allegedly resulted in underpayments from our pharmacy benefit management clients to the applicable government agencies) on
one
of the Company’s adjudication platforms. In September 2014, the Company settled the OIG’s claims, as well as related claims by the Department of Justice and private plaintiffs, without any admission of liability. The Company is in discussions with the OIG concerning other claim processing issues.
|
|
•
|
In November 2009, a securities class action lawsuit was filed in the United States District Court for the District of Rhode Island by Richard Medoff, purportedly on behalf of purchasers of CVS Health Corporation stock between May 5, 2009 and November 4, 2009. An amended complaint extended that time period back to October 30, 2008. The lawsuit names the Company and certain officers as defendants and includes allegations of securities fraud relating to public disclosures made by the Company concerning the PBM business and allegations of insider trading. In addition, a shareholder derivative lawsuit was filed by Mark Wuotila in December 2009 in the same court against the directors and certain officers of the Company. This lawsuit, which has remained stayed pending developments in the related securities class action, includes allegations of, among other things, securities fraud, insider trading and breach of fiduciary duties and further alleges that the Company was damaged by the purchase of stock at allegedly inflated prices under its share repurchase program. In January 2011, both lawsuits were transferred to the United States District Court for the District of New Hampshire. In August 2015, the Parties reached an agreement in principle to settle the Medoff action for
$48 million
. In September 2015, the Parties filed a joint stipulation seeking preliminary approval for this settlement. The Company denies any wrongdoing, and agreed to a settlement to avoid the burden, uncertainty and distraction of litigation. The settlement will be funded by insurance proceeds. The Wuotila derivative matter remains pending.
|
|
•
|
As part of a previously disclosed civil settlement agreement entered into by Omnicare with the U.S. Attorney’s Office, for the District of Massachusetts in November 2009, Omnicare also entered into an amended and restated corporate integrity agreement (“CIA”) with the OIG with a term of five years from November 2, 2009 with certain provisions continuing for a period after the term. In October 2015, Omnicare received a closure letter from the OIG. The Company is continuing discussions with the OIG around the CIA and its compliance program.
|
|
•
|
In March 2010, the Company learned that various State Attorneys General offices and certain other government agencies were conducting a multi-state investigation of certain of the Company’s business practices similar to those being investigated at that time by the U.S. Federal Trade Commission (“FTC”).
Twenty-eight
states, the District of Columbia and the County of Los Angeles are known to be participating in this investigation. The prior FTC investigation, which commenced in August 2009, was officially concluded in May 2012 when the consent order entered into between the FTC and the Company became final. The Company has cooperated with the multi-state investigation.
|
|
•
|
In March 2010, the Company received a subpoena from the OIG requesting information about programs under which the Company has offered customers remuneration conditioned upon the transfer of prescriptions for drugs or
|
|
•
|
On October 29, 2010, a
qui tam
complaint entitled United States
et al., ex rel.
Banigan and Templin v. Organon USA, Inc., Omnicare, Inc. and PharMerica Corporation, Civil No. 07-12153-RWZ, that had been filed under seal with the U.S. District Court in Boston, Massachusetts, was ordered unsealed by the court. The complaint was brought by James Banigan and Richard Templin, former employees of Organon, as private party
qui tam
relators on behalf of the federal government and several state and local governments. The action alleges civil violations of the False Claims Act based on allegations that Organon and its affiliates paid Omnicare and several other long-term care pharmacies rebates, post-purchase discounts and other forms of remuneration in return for purchasing pharmaceuticals from Organon and taking steps to increase the purchase of Organon’s drugs in violation of the Anti-Kickback Statute. The U.S. Department of Justice declined to intervene in this action. The court denied Omnicare’s motion to dismiss in June 2012. Discovery is closed in this matter. The Company believes that the allegations are without merit.
|
|
•
|
In January 2012, the United States District Court for the Eastern District of Pennsylvania unsealed a first amended
qui tam
complaint filed in August 2011 by an individual relator, Anthony Spay, who is described in the complaint as having once been employed by a firm providing pharmacy prescription benefit audit and recovery services. The complaint seeks monetary damages and alleges that Caremark’s processing of Medicare claims on behalf of one of its clients violated the federal False Claims Act. The United States declined to intervene in the lawsuit. In September 2015, the Court granted Caremark's motion for summary judgment in its entirety, and entered judgment in favor of Caremark and against Spay.
|
|
•
|
In November 2012, the Company received a subpoena from the OIG requesting information concerning automatic refill programs used by pharmacies to refill prescriptions for customers. The Company has been cooperating and providing documents and other information in response to this request for information.
|
|
•
|
In 2013, Omnicare received subpoenas seeking information regarding Omnicare’s nationwide billing practices with regard to National Drug Code overrides and Omnicare’s May 2008 acquisition of Pure Service Pharmacy. In 2014, Omnicare received subpoenas seeking information regarding Omnicare’s Auto Label Verification system and Omnicare’s per diem arrangements. Omnicare has produced documents and provided information in response to these subpoenas and continues to cooperate in the investigations.
|
|
•
|
On March 22, 2013, a
qui tam
complaint entitled United States
et al. ex rel.
Susan Ruscher v. Omnicare, Inc.
et al.
, Civil No. 08-cv-3396, which had been filed under seal in the U.S. District Court for the Southern District of Texas, was unsealed by the court. The complaint was brought by Susan Ruscher as a private party
qui tam
relator on behalf of the federal government and several state governments alleging violations of the federal False Claims Act and analogous state laws based upon allegations that Omnicare’s practices relating to customer collections violated the Anti-Kickback Statute. In September 2015, the court granted summary judgment dismissing all claims against Omnicare and denied relator’s motion for summary judgment related to Omnicare’s counterclaims and thereafter, on October 1, 2015, the court entered a final judgment for Omnicare and stayed trial on the counterclaims pending an appeal from the relator.
|
|
•
|
In January 2014, the U.S. District Court in the Southern District of New York unsealed a
qui tam
action in which the Company is a defendant. The suit originally was filed under seal in 2011 by relator David Kester, a former employee of Novartis Pharmaceuticals Corp. (“Novartis”). The suit alleges that Novartis, the Company, and other specialty pharmacies violated the federal False Claims Act, as well as the false claims acts of several states, by using pharmacists, nurses and other staff to recommend and increase the sales and market share for certain Novartis specialty drugs in exchange for patient referrals, rebates and discounts provided by Novartis. The federal government has intervened in the case as to some allegations against Novartis but has declined to intervene as to any of the allegations against the Company. Kester continued the litigation against the Company, but on June 16, 2015, filed a notice of settlement with the Court. The parties have filed a stipulation of dismissal as to the Company.
|
|
•
|
In March 2014, the Company received a subpoena from the United States Attorney’s Office for the
District of Rhode Island, requesting documents and information concerning bona fide service fees and rebates received from pharmaceutical manufacturers in connection with certain drugs utilized under Part D of the Medicare Program, as well
|
|
•
|
The U.S. Department of Justice, through the U.S. Attorney’s Office for the Western District of Virginia, investigated whether Omnicare’s activities in connection with the agreements it had with the manufacturer of the pharmaceutical Depakote violated the False Claims Act or the Anti-Kickback Statute. Omnicare cooperated with this investigation and believes that it has complied with applicable laws and regulations with respect to this matter. In connection with this matter, on December 22, 2014, the U.S. Department of Justice filed a civil complaint-in-intervention in two
qui tam
complaints, entitled United States,
et al., ex rel.
Spetter v. Abbott Laboratories, Inc., Omnicare, Inc., and PharMerica Corp., No. 1:07-cv-00006 and United States,
et al., ex rel.
McCoyd v. Abbott Laboratories, Omnicare, Inc., PharMerica Corp., and Miles White, No. 1:07-cv-00081, alleging civil violations of the False Claims Act in connection with the manufacturer agreements described above. In July 2015, the parties filed a Joint Motion to Stay the Litigation stating that the parties have reached a proposed resolution of the monetary terms of a potential settlement agreement. These financial terms are contingent on approval by authorized officials at the Department of Justice, negotiation of terms of a settlement agreement, approval and releases from the OIG, the National Association of Medicaid Fraud Control Units, and the Department of Justice, and coordination with discussions with the United States regarding other ongoing matters. While the Company believes that a final settlement will be reached, there can be no assurance that any final settlement agreement will be reached or as to the final terms of such settlement.
|
|
•
|
In May 2015, the Company entered into a settlement agreement with the U.S. Attorney’s Office for the Middle District of Florida, resolving alleged violations of the Controlled Substances Act (“CSA”). The Company paid a fine of
$22 million
in connection with the settlement. The Company is also undergoing several audits by the Drug Enforcement Agency (“DEA”) Administrator and is in discussions with the DEA and the U.S. Attorney’s Office in several locations concerning allegations that the Company has violated certain requirements of the CSA. Whether agreements can be reached and on what terms is uncertain.
|
|
•
|
In May 2015, the Company received a subpoena from the OIG requesting information and documents concerning the Company’s automatic refill programs, adherence outreach programs, and pharmacy customer incentives, particularly in connection with claims for reimbursement made to the Minnesota Medicaid program. The Company has been cooperating with the investigation and providing information in response to the subpoena.
|
|
•
|
In July 2015, the U.S. District Court in the District of Massachusetts dismissed all claims alleged in a
qui tam
lawsuit that had been brought against the Company by a pharmacy auditor and a former CVS pharmacist. The lawsuit, which was initially filed under seal in 2011, alleged that the Company violated the federal False Claims Act, as well as the false claims acts of several states, by overcharging state and federal governments in connection with prescription drugs available through the Company’s Health Savings Pass program, a membership-based program that allows enrolled customers special pricing for typical 90-day supplies of various generic prescription drugs. The federal government had declined to intervene in the case. The plaintiffs are appealing the dismissal to the U.S. Court of Appeals for First Circuit.
|
|
•
|
On July 27, 2015, a consolidated class action complaint was filed by plaintiffs naming Omnicare, the members of the Omnicare Board of Directors, CVS Health, CVS Pharmacy and its merger subsidiary as defendants. The complaint alleged that the members of the Omnicare Board of Directors breached their fiduciary duties to Omnicare’s stockholders during merger negotiations by entering into the merger agreement and approving the merger, and the CVS parties aided and abetted such breaches of fiduciary duties. In September 2015, the court granted plaintiffs’ voluntary notice of dismissal of all allegations against the defendants.
|
|
•
|
The Attorney General of the State of Texas issued civil investigative demands and other requests in February 2012, May 2014, and May 2015, and has continued its investigation concerning the Health Savings Pass program and other pricing practices with respect to claims for reimbursement from the Texas Medicaid program.
|
|
•
|
In July and September 2015, related putative class actions were filed against the Company in the U.S. District Court in the Northern District of California and the Northern District of Illinois, respectively. The first case was brought by Christopher Corcoran and six other individuals who allegedly overpaid for prescriptions for generic drugs filled at CVS pharmacies. The second case was brought by Robert Podgorny and another individual on the same theory. Both complaints seek damages and injunctive relief under the consumer protection statutes and common laws of certain states.
|
|
•
|
In September 2015, Omnicare was served with an administrative subpoena by the DEA. The subpoena seeks documents related to controlled substance policies, procedures, and practices at eight pharmacy locations from May 2012 to present. The Company currently is evaluating the subpoena and intends to cooperate with any investigation.
|
|
|
/s/ Ernst & Young LLP
|
|
|
|
|
October 30, 2015
|
|
|
Boston, Massachusetts
|
|
|
Part I
|
|
Item 2
|
|
|
Three Months Ended September 30,
|
|
Nine Months Ended September 30,
|
||||||||||||
|
In millions
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||
|
Net revenues
|
$
|
38,644
|
|
|
$
|
35,021
|
|
|
$
|
112,144
|
|
|
$
|
102,312
|
|
|
Cost of revenues
|
31,983
|
|
|
28,553
|
|
|
92,917
|
|
|
83,578
|
|
||||
|
Gross profit
|
6,661
|
|
|
6,468
|
|
|
19,227
|
|
|
18,734
|
|
||||
|
Operating expenses
|
4,330
|
|
|
4,222
|
|
|
12,502
|
|
|
12,256
|
|
||||
|
Operating profit
|
2,331
|
|
|
2,246
|
|
|
6,725
|
|
|
6,478
|
|
||||
|
Interest expense, net
|
261
|
|
|
153
|
|
|
562
|
|
|
469
|
|
||||
|
Loss on early extinguishment of debt
|
—
|
|
|
521
|
|
|
—
|
|
|
521
|
|
||||
|
Income before income tax provision
|
2,070
|
|
|
1,572
|
|
|
6,163
|
|
|
5,488
|
|
||||
|
Income tax provision
|
833
|
|
|
624
|
|
|
2,433
|
|
|
2,165
|
|
||||
|
Income from continuing operations
|
1,237
|
|
|
948
|
|
|
3,730
|
|
|
3,323
|
|
||||
|
Income from discontinued operations, net of tax
|
10
|
|
|
—
|
|
|
10
|
|
|
—
|
|
||||
|
Net income
|
1,247
|
|
|
948
|
|
|
3,740
|
|
|
3,323
|
|
||||
|
Net income attributable to noncontrolling interest
|
(1
|
)
|
|
—
|
|
|
(1
|
)
|
|
—
|
|
||||
|
Net income attributable to CVS Health
|
$
|
1,246
|
|
|
$
|
948
|
|
|
$
|
3,739
|
|
|
$
|
3,323
|
|
|
In millions
|
Pharmacy
Services
Segment
(1)
|
|
Retail/LTC
Segment
|
|
Corporate
Segment
|
|
Intersegment
Eliminations
(2)
|
|
Consolidated
Totals
|
||||||||||
|
Three Months Ended
|
|
|
|
|
|
|
|
|
|
||||||||||
|
September 30, 2015:
|
|
|
|
|
|
|
|
|
|
||||||||||
|
Net revenues
|
$
|
25,528
|
|
|
$
|
17,912
|
|
|
$
|
—
|
|
|
$
|
(4,796
|
)
|
|
$
|
38,644
|
|
|
Gross profit
|
1,468
|
|
|
5,373
|
|
|
—
|
|
|
(180
|
)
|
|
6,661
|
|
|||||
|
Operating profit (loss)
(3)
|
1,162
|
|
|
1,643
|
|
|
(309
|
)
|
|
(165
|
)
|
|
2,331
|
|
|||||
|
September 30, 2014:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Net revenues
|
22,534
|
|
|
16,749
|
|
|
—
|
|
|
(4,262
|
)
|
|
35,021
|
|
|||||
|
Gross profit
|
1,403
|
|
|
5,237
|
|
|
—
|
|
|
(172
|
)
|
|
6,468
|
|
|||||
|
Operating profit (loss)
|
1,087
|
|
|
1,527
|
|
|
(196
|
)
|
|
(172
|
)
|
|
2,246
|
|
|||||
|
Nine Months Ended
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
September 30, 2015:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Net revenues
|
73,849
|
|
|
52,105
|
|
|
—
|
|
|
(13,810
|
)
|
|
112,144
|
|
|||||
|
Gross profit
|
3,735
|
|
|
15,990
|
|
|
—
|
|
|
(498
|
)
|
|
19,227
|
|
|||||
|
Operating profit (loss)
(3)
|
2,837
|
|
|
5,050
|
|
|
(712
|
)
|
|
(450
|
)
|
|
6,725
|
|
|||||
|
September 30, 2014:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Net revenues
|
64,566
|
|
|
50,100
|
|
|
—
|
|
|
(12,354
|
)
|
|
102,312
|
|
|||||
|
Gross profit
|
3,533
|
|
|
15,719
|
|
|
—
|
|
|
(518
|
)
|
|
18,734
|
|
|||||
|
Operating profit (loss)
|
2,605
|
|
|
4,982
|
|
|
(591
|
)
|
|
(518
|
)
|
|
6,478
|
|
|||||
|
(1)
|
Net revenues of the Pharmacy Services Segment include approximately
$2.1 billion
and
$1.9 billion
of retail co-payments for the three months ended
September 30, 2015
and 2014, respectively, as well as
$6.8 billion
and
$6.1 billion
of retail co-payments for the nine months ended
September 30, 2015
and 2014, respectively.
|
|
(2)
|
Intersegment eliminations relate to intersegment revenue generating activities that occur between the Pharmacy Services Segment and the Retail/LTC Segment. These occur in the following ways: when members of Pharmacy Services Segment clients (“members”) fill prescriptions at retail stores to purchase covered products, when members enrolled in programs such as Maintenance Choice
®
elect to pick up maintenance prescriptions at a retail drugstore instead of receiving them through the mail, or when members have prescriptions filled at long-term care facilities. When these occur, both the Pharmacy Services and Retail/LTC segments record the revenues, gross profit and operating profit on a standalone basis.
|
|
(3)
|
The Corporate Segment operating loss includes
$115 million
and
$135 million
of acquisition-related transaction and integration costs for the three and nine months ended September 30, 2015, respectively.
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
||||||||||||
|
In millions
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||
|
Net revenues
|
$
|
25,528
|
|
|
$
|
22,534
|
|
|
$
|
73,849
|
|
|
$
|
64,566
|
|
|
Gross profit
|
1,468
|
|
|
1,403
|
|
|
3,735
|
|
|
3,533
|
|
||||
|
Gross profit % of net revenues
|
5.8
|
%
|
|
6.2
|
%
|
|
5.1
|
%
|
|
5.5
|
%
|
||||
|
Operating expenses
|
306
|
|
|
316
|
|
|
898
|
|
|
928
|
|
||||
|
Operating expense % of net revenues
|
1.2
|
%
|
|
1.4
|
%
|
|
1.2
|
%
|
|
1.4
|
%
|
||||
|
Operating profit
|
1,162
|
|
|
1,087
|
|
|
2,837
|
|
|
2,605
|
|
||||
|
Operating profit % of net revenues
|
4.6
|
%
|
|
4.8
|
%
|
|
3.8
|
%
|
|
4.0
|
%
|
||||
|
Net revenues:
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Mail choice
(2)
|
$
|
9,735
|
|
|
$
|
8,054
|
|
|
$
|
27,592
|
|
|
$
|
22,641
|
|
|
Pharmacy network
(1)(3)
|
15,716
|
|
|
14,420
|
|
|
46,043
|
|
|
41,748
|
|
||||
|
Other
|
77
|
|
|
60
|
|
|
214
|
|
|
177
|
|
||||
|
Pharmacy claims processed:
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Total
|
251.0
|
|
|
230.3
|
|
|
752.3
|
|
|
689.1
|
|
||||
|
Mail choice
(2)
|
21.9
|
|
|
20.7
|
|
|
63.5
|
|
|
61.1
|
|
||||
|
Pharmacy network
(1)(3)
|
229.1
|
|
|
209.6
|
|
|
688.8
|
|
|
628.0
|
|
||||
|
Generic dispensing rate:
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Total
|
83.8
|
%
|
|
82.5
|
%
|
|
83.7
|
%
|
|
82.3
|
%
|
||||
|
Mail choice
(2)
|
76.5
|
%
|
|
75.0
|
%
|
|
76.3
|
%
|
|
74.5
|
%
|
||||
|
Pharmacy network
(1)(3)
|
84.5
|
%
|
|
83.2
|
%
|
|
84.4
|
%
|
|
83.1
|
%
|
||||
|
Mail choice penetration rate
|
21.1
|
%
|
|
21.7
|
%
|
|
20.5
|
%
|
|
21.5
|
%
|
||||
|
•
|
Our mail choice claims processed increased 5.6% to 21.9 million claims in the three months ended September 30, 2015, compared to 20.7 million claims in the prior year. The increase in mail choice claims was driven by specialty and continuing adoption of our Maintenance Choice offerings.
|
|
•
|
Our average revenue per mail choice claim increased by 14.4%, compared to the prior year. This increase was primarily due to growth in specialty pharmacy.
|
|
•
|
Our pharmacy network claims processed increased 9.3% to 229.1 million claims in the three months ended September 30, 2015, compared to 209.6 million claims in the prior year. The increase in the pharmacy network claim volume was primarily due to net new business, as well as growth in Managed Medicaid.
|
|
•
|
Our average revenue per pharmacy network claim processed remained relatively flat compared to the prior year.
|
|
•
|
Our mail choice generic dispensing rate increased to 76.5% in the
three months ended September 30, 2015
, compared to 75.0% in the prior year. Our pharmacy network generic dispensing rate increased to 84.5%, compared to 83.2% in the prior year. These continued increases in mail choice and pharmacy network generic dispensing rates were primarily due to the impact of new generic drug introductions, and our continuous efforts to encourage plan members to use generic drugs when they are available. We believe our generic dispensing rates will continue to increase in future periods, albeit at a slower pace. This increase will be affected by, among other things, the number of new generic drug introductions and our success at encouraging plan members to utilize generic drugs when they are available and clinically appropriate.
|
|
•
|
Our mail choice claims processed increased 4.1% to 63.5 million claims in the
nine months ended September 30, 2015
, compared to 61.1 million claims in the prior year. The increase in mail choice claims was driven by specialty claim volume and increased claims associated with the continuing adoption of our Maintenance Choice offerings.
|
|
•
|
Our average revenue per mail choice claim increased by 17.1%, compared to the prior year. This increase was primarily due to growth in specialty pharmacy.
|
|
•
|
Our pharmacy network claims processed increased 9.7% to 688.8 million claims in the
nine months ended September 30, 2015
, compared to 628.0 million claims in the prior year. The increase in the pharmacy network claim volume was primarily due to net new business, as well as growth in Managed Medicaid.
|
|
•
|
Our average revenue per pharmacy network claim processed remained relatively flat compared to the prior year.
|
|
•
|
Our mail choice generic dispensing rate increased to 76.3% in the
nine months ended September 30, 2015
, compared to 74.5% in the prior year. Our pharmacy network generic dispensing rate increased to 84.4%, compared to 83.1% in the prior year. These continued increases in mail choice and pharmacy network generic dispensing rates were primarily due to the impact of new generic drug introductions, and our continuous efforts to encourage plan members to use generic drugs when they are available. We believe our generic dispensing rates will continue to increase in future periods, albeit at a slower pace. This increase will be affected by, among other things, the number of new generic drug introductions and our success at encouraging plan members to utilize generic drugs when they are available and clinically appropriate.
|
|
•
|
Our gross profit dollars and gross profit as a percentage of net revenues continued to be impacted by our efforts to (i) retain existing clients, (ii) obtain new business and (iii) maintain or improve the rebates and/or discounts we received from manufacturers, wholesalers and retail pharmacies. In particular, competitive pressures in the PBM industry have caused us and other PBMs to continue to share a larger portion of rebates and/or discounts received from pharmaceutical manufacturers with clients. In addition, market dynamics and regulatory changes have impacted our ability to offer plan sponsors pricing that includes retail network “differential” or “spread”. We expect these trends to continue. The “differential” or “spread” is any difference between the drug price charged to plan sponsors, including Medicare Part D plan sponsors, by a PBM and the price paid for the drug by the PBM to the dispensing provider. The increased use by patients of generic drugs has positively impacted our gross profit margins but has resulted in third party payors augmenting their efforts to reduce reimbursement payments for prescriptions. This trend, which we expect to continue, reduces the benefit we realize from brand to generic product conversions.
|
|
•
|
Our gross profit as a percentage of revenues benefited from the increase in our total generic dispensing rate, which increased to 83.8% and 83.7% in the three and
nine months ended September 30, 2015
, respectively, compared to our generic dispensing rate of 82.5% and 82.3% in the prior year, respectively. This increase was primarily due to new generic drug introductions and our continual efforts to encourage plan members to use clinically appropriate generic drugs when they are available. We expect the trend in generic introductions to continue, albeit at a slower pace.
|
|
|
Three Months Ended
September 30,
|
|
Nine Months Ended
September 30,
|
||||||||||||
|
In millions
|
2015
|
|
2014
|
|
2015
|
|
2014
|
||||||||
|
|
|
|
|
|
|
|
|
||||||||
|
Net revenues
|
$
|
17,912
|
|
|
$
|
16,749
|
|
|
$
|
52,105
|
|
|
$
|
50,100
|
|
|
Gross profit
|
5,373
|
|
|
5,237
|
|
|
15,990
|
|
|
15,719
|
|
||||
|
Gross profit % of net revenues
|
30.0
|
%
|
|
31.3
|
%
|
|
30.7
|
%
|
|
31.4
|
%
|
||||
|
Operating expenses
|
3,730
|
|
|
3,710
|
|
|
10,940
|
|
|
10,737
|
|
||||
|
Operating expense % of net revenues
|
20.8
|
%
|
|
22.1
|
%
|
|
21.0
|
%
|
|
21.4
|
%
|
||||
|
Operating profit
|
1,643
|
|
|
1,527
|
|
|
5,050
|
|
|
4,982
|
|
||||
|
Operating profit % of net revenues
|
9.2
|
%
|
|
9.1
|
%
|
|
9.7
|
%
|
|
9.9
|
%
|
||||
|
Prescriptions filled (90 Day = 3 Rx)
(1)
|
258.7
|
|
|
233.7
|
|
|
744.1
|
|
|
691.1
|
|
||||
|
Net revenue increase (decrease):
|
|
|
|
|
|
|
|
|
|
|
|
||||
|
Total
|
6.9
|
%
|
|
3.1
|
%
|
|
4.0
|
%
|
|
3.5
|
%
|
||||
|
Pharmacy
|
10.4
|
%
|
|
5.3
|
%
|
|
7.0
|
%
|
|
5.0
|
%
|
||||
|
Front store
|
(2.4
|
)%
|
|
(3.7
|
)%
|
|
(3.7
|
)%
|
|
(1.6
|
)%
|
||||
|
Total prescription volume (90 Day = 3 Rx)
(1)
|
10.7
|
%
|
|
6.4
|
%
|
|
7.7
|
%
|
|
4.6
|
%
|
||||
|
Same store increase (decrease)
(2)
:
|
|
|
|
|
|
|
|
|
|
|
|||||
|
Total sales
|
1.7
|
%
|
|
2.0
|
%
|
|
1.1
|
%
|
|
2.3
|
%
|
||||
|
Pharmacy sales
|
4.6
|
%
|
|
4.8
|
%
|
|
4.3
|
%
|
|
4.5
|
%
|
||||
|
Front store sales
(3)
|
(5.8
|
)%
|
|
(4.5
|
)%
|
|
(6.6
|
)%
|
|
(2.9
|
)%
|
||||
|
Prescription volume (90 Day = 3 Rx)
(1)
|
4.4
|
%
|
|
5.1
|
%
|
|
4.8
|
%
|
|
3.7
|
%
|
||||
|
Generic dispensing rate
|
84.8
|
%
|
|
83.3
|
%
|
|
84.7
|
%
|
|
83.3
|
%
|
||||
|
Pharmacy % of total revenues
|
74.1
|
%
|
|
71.8
|
%
|
|
72.5
|
%
|
|
70.5
|
%
|
||||
|
(1)
|
Includes the adjustment to convert 90-day, non-specialty prescriptions to the equivalent of three 30-day prescriptions. This adjustment reflects the fact that these prescriptions include approximately three times the amount of product days supplied compared to a normal prescription.
|
|
(2)
|
Same store sales and prescriptions exclude revenues from MinuteClinic, and revenue and prescriptions from stores in Brazil, LTC operations and from commercialization services.
|
|
(3)
|
Front store same store sales would have been approximately 490 and 690 basis points higher for the three and nine months ended
September 30, 2015
, respectively, if tobacco and the estimated associated basket sales were excluded from the three months and nine months ended
September 30, 2014
.
|
|
•
|
Net revenues from new stores accounted for approximately 140 basis points and 160 basis points of the increase in our total net revenues for the three and
nine months ended September 30, 2015
, respectively. Total net revenues were also positively affected by the addition of LTC operations.
|
|
•
|
Front store same store sales decreased by 5.8% and 6.6% for the three and
nine months ended September 30, 2015
, respectively, compared to the prior year. The decrease is primarily due to the Company’s decision to stop selling tobacco products and softer customer traffic. On a comparable basis, front store same store sales would have been approximately 490 and 690 basis points higher for the three and
nine months ended September 30, 2015
, respectively, if tobacco and the estimated associated basket sales were excluded from both the three and
nine months ended September 30, 2014
.
|
|
•
|
Pharmacy same store sales increased 4.6% and 4.3% for the three and
nine months ended September 30, 2015
, respectively, as compared to the prior year. The increase in pharmacy same store sales was primarily due to the increase in same store script growth of 4.4% and 4.8% for the three and
nine months ended September 30, 2015
, respectively.
|
|
•
|
Pharmacy revenues continue to be negatively impacted by the conversion of brand name drugs to equivalent generic drugs, which typically have a lower selling price. Pharmacy same store sales were negatively impacted by approximately 450 and 370 basis points for the three and
nine months ended September 30, 2015
, respectively, due to recent generic introductions. The generic dispensing rate grew to 84.8% and 84.7% for the three and
nine months ended September 30, 2015
, respectively, compared to 83.3% for both of the comparable periods in the prior year, respectively. In addition, our pharmacy revenue growth has also been affected by continued reimbursement pressure, the lack of significant new brand name drug introductions and an increase in the number of over-the-counter remedies that were historically only available by prescription.
|
|
•
|
Pharmacy revenue growth continued to benefit from the increased utilization by Medicare Part D beneficiaries, our ability to attract and retain managed care customers and favorable industry trends. These trends include an aging American population; “baby boomers” are now in their fifties and sixties and are consuming a greater number of prescription drugs, as well as expanded coverage from the Patient Protection and Affordable Care Act (“ACA”). In addition, the increased use of pharmaceuticals as the first line of defense for individual health care contributed to the growing demand for pharmacy services. We believe these favorable industry trends will continue.
|
|
•
|
Front store revenues as a percentage of total revenues for the three and
nine months ended September 30, 2015
, was 25.3% and 26.9%, respectively, compared to 27.7% and 29.0% in the prior year, respectively. On average, our gross profit on front store revenues is higher than our gross profit on pharmacy revenues. Pharmacy revenues as a percentage of total revenues increased approximately 250 and 200 basis points in the three and
nine months ended September 30, 2015
, respectively, compared to the prior year. This was due to pharmacy revenues growing faster than front store revenues, as well as the acquisition of Omnicare. The mix effect from a higher proportion of pharmacy sales had a negative effect on our overall gross profit for the three and
nine months ended September 30, 2015
, respectively, compared to the prior year. This negative effect was partially offset by increased generic drug dispensing rates, the removal of tobacco products from our stores and increased store brand penetration.
|
|
•
|
During the three and
nine months ended September 30, 2015
, our front store gross profit as a percentage of net revenues increased compared to the same period in the prior year. The increase is primarily related to a change in the mix of products sold, including the removal of tobacco products from our stores, and higher store brand sales.
|
|
•
|
Our pharmacy gross profit rates have been adversely affected by the efforts of managed care organizations, PBMs and governmental and other third-party payors to reduce their prescription drug costs, as well as changes in the mix of our business within pharmacy. In the event this trend accelerates, we may not be able to sustain our current rate of revenue
|
|
|
|
Nine Months Ended September 30,
|
||||||
|
in millions
|
|
2015
|
|
2014
|
||||
|
Net cash provided by operating activities
|
|
$
|
4,841
|
|
|
$
|
4,714
|
|
|
Net cash used in investing activities
|
|
(11,000
|
)
|
|
(3,534
|
)
|
||
|
Net cash provided by (used in) financing activities
|
|
6,576
|
|
|
(4,133
|
)
|
||
|
Effect of exchange rate changes on cash and cash equivalents
|
|
(8
|
)
|
|
(4
|
)
|
||
|
Net increase (decrease) in cash and cash equivalents
|
|
$
|
409
|
|
|
$
|
(2,957
|
)
|
|
In billions
|
|
|
|
|
|
|
||||
|
Authorization Date
|
Authorized
|
Remaining
|
||||||||
|
December 15, 2014 (“2014 Repurchase Program”)
|
|
$
|
10.0
|
|
|
|
$
|
8.8
|
|
|
|
December 17, 2013 (“2013 Repurchase Program”)
|
|
$
|
6.0
|
|
|
|
—
|
|
|
|
|
|
|
|
|
|
$
|
8.8
|
|
|
||
|
Interest Rate and Maturity
|
|
Aggregate Principal Amount (In Millions)
|
|
Percentage of Total Outstanding Principal Amount Exchanged
|
|||
|
4.75% senior notes due 2022
|
|
$
|
388
|
|
|
96.8
|
%
|
|
5% senior notes due 2024
|
|
296
|
|
|
98.8
|
%
|
|
|
Total senior notes issued under exchange transaction
|
|
$
|
684
|
|
|
|
|
|
•
|
Risks relating to the health of the economy in general and in the markets we serve, which could impact consumer purchasing power, preferences and/or spending patterns, drug utilization trends, the financial health of our PBM clients or other payors doing business with the Company and our ability to secure necessary financing, suitable store locations and sale-leaseback transactions on acceptable terms.
|
|
•
|
Efforts to reduce reimbursement levels and alter health care financing practices, including pressure to reduce reimbursement levels for generic drugs.
|
|
•
|
The possibility of PBM client loss and/or the failure to win new PBM business, including as a result of failure to win renewal of expiring contracts, contract termination rights that may permit clients to terminate a contract prior to expiration and early or periodic renegotiation of pricing by clients prior to expiration of a contract.
|
|
•
|
The possibility of loss of Medicare Part D business and/or failure to obtain new Medicare Part D business, whether as a result of the annual Medicare Part D competitive bidding process or otherwise.
|
|
•
|
Risks related to the frequency and rate of the introduction of generic drugs and brand name prescription products.
|
|
•
|
Risks of declining gross margins in the PBM industry attributable to increased competitive pressures, increased client demand for lower prices, enhanced service offerings and/or higher service levels and market dynamics and regulatory changes that impact our ability to offer plan sponsors pricing that includes the use of retail “differential” or “spread.”
|
|
•
|
Regulatory changes, business changes and compliance requirements and restrictions that may be imposed by Centers for Medicare and Medicaid Services (“CMS”), Office of Inspector General or other government agencies relating to the Company’s participation in Medicare, Medicaid and other federal and state government-funded programs, including sanctions and remedial actions that may be imposed by CMS on its Medicare Part D business.
|
|
•
|
Risks and uncertainties related to the timing and scope of reimbursement from Medicare, Medicaid and other government-funded programs, including the impact of sequestration, the impact of other federal budget, debt and deficit negotiations and legislation that could delay or reduce reimbursement from such programs and the impact of any closure, suspension or other changes affecting federal or state government funding or operations.
|
|
•
|
Possible changes in industry pricing benchmarks used to establish pricing in many of our PBM client contracts, pharmaceutical purchasing arrangements, retail network contracts, specialty payor agreements and other third party payor contracts.
|
|
•
|
A highly competitive business environment, including the uncertain impact of increased consolidation in the PBM industry, uncertainty concerning the ability of our retail pharmacy business to secure and maintain contractual relationships with PBMs and other payors on acceptable terms, uncertainty concerning the ability of our PBM business to secure and maintain competitive access, pricing and other contract terms from retail network pharmacies in an environment where some PBM clients are willing to consider adopting narrow or more restricted retail pharmacy networks.
|
|
•
|
The Company’s ability to timely identify or effectively respond to changing consumer preferences and spending patterns, an inability to expand the products being purchased by our customers, or the failure or inability to obtain or offer particular categories of products.
|
|
•
|
Risks relating to our ability to secure timely and sufficient access to the products we sell from our domestic and/or international suppliers.
|
|
•
|
Reform of the U.S. health care system, including ongoing implementation of ACA, continuing legislative efforts, regulatory changes and judicial interpretations impacting our health care system and the possibility of shifting political and legislative priorities related to reform of the health care system in the future.
|
|
•
|
Risks relating to any failure to properly maintain our information technology systems, our information security systems and our infrastructure to support our business and to protect the privacy and security of sensitive customer and business information.
|
|
•
|
Risks related to compliance with a broad and complex regulatory framework, including compliance with new and existing federal, state and local laws and regulations relating to health care, accounting standards, corporate securities, tax, environmental and other laws and regulations affecting our business.
|
|
•
|
Risks related to litigation, government investigations and other legal proceedings as they relate to our business, the pharmacy services, retail pharmacy or retail clinic industries or to the health care industry generally.
|
|
•
|
The risk that any condition related to the closing of any proposed acquisition may not be satisfied on a timely basis or at all, including the inability to obtain required regulatory approvals of any proposed acquisition, or on the terms desired or anticipated; the risk that such approvals may result in the imposition of conditions that could adversely affect the resulting combined company or the expected benefits of any proposed transaction; and the risk that the proposed transactions fail to close for any other reason.
|
|
•
|
The possibility that the anticipated synergies and other benefits from any acquisition by us will not be realized, or will not be realized within the expected time periods
|
|
•
|
The risks and uncertainties related to our ability to integrate the operations, products, services and employees of any entities acquired by us and the effect of the potential disruption of management’s attention from ongoing business operations due to any pending acquisitions.
|
|
•
|
The accessibility or availability of adequate financing on a timely basis and on reasonable terms in connection with any proposed acquisition.
|
|
•
|
Risks related to the outcome of any legal proceedings related to, or involving any entity that is a part of, any proposed acquisition contemplated by us.
|
|
•
|
Other risks and uncertainties detailed from time to time in our filings with the SEC.
|
|
Part II
|
||
|
Fiscal Period
|
Total Number
of Shares
Purchased
|
|
Average
Price Paid
per Share
|
|
Total Number of
Shares
Purchased as Part of
Publicly Announced
Plans or Programs
|
|
Approximate Dollar
Value of Shares that
May Yet Be
Purchased Under the
Plans or Programs
|
||||||
|
July 1, 2015 through July 31, 2015
|
4,600,705
|
|
|
$
|
107.94
|
|
|
4,600,705
|
|
|
$
|
9,261,564,176
|
|
|
August 1, 2015 through August 31, 2015
|
2,204,100
|
|
|
$
|
105.58
|
|
|
2,204,100
|
|
|
$
|
9,028,861,199
|
|
|
September 1, 2015 through September 30, 2015
|
2,043,853
|
|
|
$
|
101.79
|
|
|
2,043,853
|
|
|
$
|
8,820,813,163
|
|
|
Totals
|
8,848,658
|
|
|
|
|
|
8,848,658
|
|
|
|
|
||
|
3.1*
|
Amended and Restated Certificate of Incorporation of the Registrant [incorporated by reference to Exhibit 3.1 of the Registrant’s Annual Report on Form 10-K for the fiscal year ended December 31, 1996 (Commission File No. 001-01011)].
|
|
3.1A*
|
Certificate of Amendment to the Amended and Restated Certificate of Incorporation, effective May 13, 1998 [incorporated by reference to Exhibit 4.1A to Registrant’s Registration Statement No. 333-52055 on Form S-3/A dated May 18, 1998 (Commission File No. 001-01001)].
|
|
3.1B*
|
Certificate of Amendment to the Amended and Restated Certificate of Incorporation [incorporated by reference to Exhibit 3.1 to Registrant’s Current Report on Form 8-K dated March 22, 2007 (Commission File No. 001-01011)].
|
|
3.1C*
|
Certificate of Merger dated May 9, 2007 [incorporated by reference to Exhibit 3.1C to Registrant’s Quarterly Report on Form 10-Q dated November 1, 2007 (Commission File No. 001-01011)].
|
|
3.1D*
|
Certificate of Amendment to the Amended and Restated Certificate of Incorporation [incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K dated May 13, 2010 (Commission File No. 001-01011)].
|
|
3.1E*
|
Certificate of Amendment to the Amended and Restated Certificate of Incorporation [incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K dated May 10, 2012 (Commission File No. 001-01011)].
|
|
3.1F*
|
Certificate of Amendment to the Amended and Restated Certificate of Incorporation [incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K dated May 13, 2013 (Commission File No. 001-01011)].
|
|
3.1G*
|
Certificate of Amendment to the Amended and Restated Certificate of Incorporation [incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K dated September 3, 2014 (Commission File No. 001-01011)].
|
|
3.2*
|
By-laws of Registrant, as amended and restated [incorporated by reference to Exhibit 3.2 to the Registrant's Current Report on Form 8-K dated September 3, 2014 (Commission File No. 001-01011)].
|
|
4.1*
|
Registration Rights Agreement, dated as of October 9, 2015, by and among the Registrant and the dealer managers named therein [incorporated by reference to Exhibit 4.3 to the Registrant's Current Report on Form 8-K dated October 6, 2015 (Commission File No. 001-01011)].
|
|
15.1
|
Letter re: Unaudited Interim Financial Information.
|
|
31.1
|
Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
31.2
|
Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
|
|
32.1
|
Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
32.2
|
Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
101
|
The following materials from the CVS Health Corporation Quarterly Report on Form 10-Q for the three months ended September 30, 2015 formatted in Extensible Business Reporting Language (XBRL): (i) the Condensed Consolidated Statements of Income, (ii) the Condensed Consolidated Statements of Comprehensive Income, (iii) the Condensed Consolidated Balance Sheets, (iv) the Condensed Consolidated Statements of Cash Flows and (v) related Footnotes to the Condensed Consolidated Financial Statements.
|
|
CVS Health Corporation
|
|
|
(Registrant)
|
|
|
|
|
|
/s/ David M. Denton
|
|
|
|
|
|
David M. Denton
|
|
|
Executive Vice President and
|
|
|
Chief Financial Officer
|
|
|
October 30, 2015
|
|
|
|
|
No information found
* THE VALUE IS THE MARKET VALUE AS OF THE LAST DAY OF THE QUARTER FOR WHICH THE 13F WAS FILED.
| FUND | NUMBER OF SHARES | VALUE ($) | PUT OR CALL |
|---|
| DIRECTORS | AGE | BIO | OTHER DIRECTOR MEMBERSHIPS |
|---|
No information found
No Customers Found
Suppliers
Price
Yield
| Owner | Position | Direct Shares | Indirect Shares |
|---|