CVS Health announced Friday it has reached terms with Walmart on a deal that will keep the big-box retailer as part of its pharmacy network, resolving a dispute over the cost of filling prescriptions.
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The two companies said they had made a “multi-year agreement” for Walmart to participate in the CVS Caremark and Managed Medicaid pharmacy benefit networks. Without a deal, those plans would have stopped covering the cost of prescriptions filled at Walmart pharmacies, meaning employees reliant on CVS Caremark drug benefits and Medicaid recipients would not be reimbursed.
"We are very pleased to have reached a mutually agreeable solution with Walmart. As a PBM, our top priority is to help our clients and consumers lower their pharmacy costs," CVS Caremark President Derica Rice said in a statement. "This new agreement accomplishes our top priority and enables Walmart to continue participating in CVS Caremark's commercial and Managed Medicaid pharmacy networks and provides enhanced network stability for our clients and their members."
FOX Business breaks down key details of the agreement below.
The deal nearly fell apart
CVS Caremark had warned earlier this week that Walmart was preparing to leave its network. The Wall Street Journal reported differing accounts from the two companies – CVS Caremark said Walmart was attempting to increase the fees it would receive to fulfill prescriptions, while a source familiar with Walmart’s stance said the retailer wanted to maintain current rates.
The new terms are unclear
While the disagreement between the two companies reportedly centered on prescription fulfillment fees, the press release did not disclose the agreement’s financial terms.
Walmart a key pharmacy player
Losing Walmart pharmacies would have dealt a major blow to the CVS Caremark network. The big-box retailer operates pharmacies in the vast majority of its thousands of U.S. store locations. With Walmart, CVS Caremark has a network of nearly 68,000 pharmacies, according to the press release.
The fight over fees came amid a crackdown by the Trump administration on the cost of prescription medications. President Trump has vowed to keep medicine affordable for Americans and publicly chastised companies over pricing.