Goldman Sachs 2020
Global Healthcare
Conference
Eva Boratto
Executive Vice President &
Chief Financial Officer
Karen Lynch
Executive Vice President &
President of Aetna
June 10, 2020
Cautionary statement concerning forward-looking statements
This presentation includes forward-looking statements. The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements made by or on behalf of CVS Health Corporation. By their nature, all forward-looking statements are not guarantees of future performance or results and are subject to risks and uncertainties that are difficult to predict and/or quantify. Actual results may differ materially from those contemplated by the forward-looking statements due to the risks and uncertainties related to the COVID-19 pandemic, the severity and duration of the pandemic, the pandemic's impact on the U.S. and global economies and consumer behavior and health care utilization patterns, and the timing, scope and impact of stimulus legislation and other federal, state and local governmental responses to the pandemic, as well as the other risks and uncertainties described in our Securities and Exchange Commission filings, including those set forth in the Risk Factors section and under the heading "Cautionary Statement Concerning Forward-Looking Statements" in our most recently filed Annual Report on Form 10-K, our most recently filed Quarterly Report on Form 10-Q and our recently filed Current Reports on Form 8-K.
This presentation includes non-GAAP financial measures that we use to describe our company's performance. In accordance with SEC regulations, you can find the definitions of these non-GAAP measures, as well as reconciliations to the most directly comparable GAAP measures, on the Investor Relations portion of our website.
2©2020 CVS Health and/or one of its affiliates.
Unmatched ability to engage with consumers -
CVS Health interacts with one in three Americans annually
Our stores are in their
community
~70%of U.S. population lives within 3 miles of a CVS Pharmacy
-
Increase in Q1 2020 compared to Q1 2019
3©2020 CVS Health and/or one of its affiliates.
Consumers invite us | We are embedded in | |||
into their homes | consumers digital lives | |||
Visits annually to | ~ | 600 | % | Increase* in utilization |
homes or other | of telemedicine for | |||
700Kcommunity settings | virtual visits through |
MinuteClinic®
Rapid Testing Site
Rhode Island
CVS Pharmacy
Drive-thru testing
4©2020 CVS Health and/or one of its affiliates.
Supporting our communities
~240k
~1.5M
COVID-19 tests administered through the end of May across 5 rapid testing sites and ~1,000 CVS drive-thru locations
Testing capacity for COVID-19 tests per month across ~1,000 CVS drive-thru locations
5©2020 CVS Health and/or one of its affiliates.
Opportunities to utilize CVS Health Retail assets
Treatment therapies
Ability to provide medication therapies and vaccines, once available
Payor solutions
Exploring employer solutions, including testing for employee populations to help employers effectively manage the return and maintenance of their workforces
6©2020 CVS Health and/or one of its affiliates.
Q1 2020 RESULTS
Consolidated Enterprise
in millions, | |||||||
except per share data | Q1 2020 | Q1 2019 | Change % | ||||
Total revenues | $66,755 | $61,646 | 8.3% | Total revenue growth coming from all segments; portion | |||
of growth driven by COVID-19 related pull forward of | |||||||
scripts and front store sales increases | |||||||
Adjusted Operating Income growth driven by Pharmacy | |||||||
Adjusted operating income | $4,113 | $3,595 | 14.4% | Services and Retail/LTC, partially offset by a slight | |||
decline in Health Care Benefits | |||||||
GAAP EPS | $1.53 | $1.09 | 40.4% | GAAP and Adjusted EPS growth driven by Pharmacy | |||
Services and Retail/LTC, as well as lower interest | |||||||
expense, partially offset by higher income tax expense | |||||||
COVID-19 related business activity added | |||||||
Adjusted EPS | |||||||
$1.91 | $1.62 | 17.9% | approximately 10 cents | ||||
7©2020 CVS Health and/or one of its affiliates.
May business update
Retail same store sales1
Pharmacy sales
Pharmacy adjusted prescription volume2
Front Store sales
Pharmacy Services total claims processed2
HCB decreases in utilization across an array of services
March 2020 | April 2020 | |
YoY | YoY3 | |
17.5% | 1.5% | |
17.2% | 5.4% | |
12.6% | (0.5%) | |
18.6% | (10.7%) | |
17.0% 0.6%
(~30%)
May 2020
YoY3
(1.1%)
(0.5%)
(4.2%)
(3.2%)
(2.3%)
(~25%)
Change in May prescription and claims processed volume year-over-year versus April driven by continued reversal of the pull-forward in scripts seen in March, and drop in new prescriptions related to lower physician visits
Decline in April Front Store sales year-over- year as increased basket size is offset by reduction in store traffic as shelter in place orders took hold. Improvement in May sales year-over-year compared to April due to increased store traffic
Reduction in discretionary utilization that began in mid-March continued through April with a modest increase in May; Q2 2020 MBR could be lowest of the year
- Same store sales and prescription volume exclude revenues from MinuteClinic and revenues and prescriptions fromlong-term care operations and, in 2019, from stores in Brazil.
- Includes an adjustment to convert90-day 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.
- April 2020 and May 2020 information is preliminary.
8©2020 CVS Health and/or one of its affiliates.
Cannot predict impact of delayed or missed treatment on members with chronic conditions
Executing on strategic priorities
Consumer focused - be local, make it simple, improve health
9©2020 CVS Health and/or one of its affiliates.
Grow and | Deliver |
differentiate our | transformational |
businesses | products and services |
Create a consumer- | Modernize Enterprise |
centric technology | functions and |
infrastructure | capabilities |
10©2020 CVS Health and/or one of its affiliates. Confidential and proprietary.
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CVS Health Corporation published this content on 10 June 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 10 June 2020 12:06:59 UTC