Here’s How the 2 Biggest Players in the Battle of the Drugstores Stack Up Head-to-Head

Walgreens and CVS look to become healthcare providers

Drugstores have exploded into a $252 billion business in the United States, and with over 11 million Americans coming into the healthcare system via Obamacare so far this year, it's only going to get bigger. And yet, the segment's getting smaller all the time—not in dollar value, but brands. If you're on your way to the local drugstore, chances are it's one of three places—Walgreens, CVS or Rite Aid. Now consider this: If regulators green light Walgreens' plan to gobble up Rite Aid, those players will dwindle to two. Few other industries have so few chains competing for so much revenue. So, who's likely to come out on top? And what distinguishes the top two brands, anyway? Below, a snapshot of big pharma's biggest retailers. Might as well get acquainted now, since they'll probably be filling your next prescription very soon.


From its early days as Customer Value Stores (hence, CVS), a health and beauty chain in New England, CVS Health has morphed into an integrated healthcare services provider. In addition to CVS/pharmacy—which now operates in 45 states—the company runs a pharmacy benefit management division called CVS/Caremark, with 75 million plan members; CVS/specialty pharmacy (for medications that require high-maintenance handling); and CVS/MinuteClinic, a chain of walk-in care centers staffed by nurse practitioners who can administer lab tests and vaccines, write prescriptions, and treat a variety of minor illnesses and injuries including sprains, burns and infections. CVS sent shock waves through the industry on Feb. 5, 2014 with the announcement that its 7,600 stores would no longer carry tobacco products. Scrapping the cigs, chew and snuff meant the immediate loss of $2 billion in annual revenue, but CEO Larry Merlo explained that "tobacco products have no place in a setting where healthcare is delivered." Since then, CVS has doubled down on its bet, launching "Let's Quit Together" and positioning itself as a health advocate. Meanwhile, CVS continues to get bigger. In March, it acquired all of Target's 1,672 in-store pharmacies for $1.9 billion.


Assuming the Federal Trade Commission goes for it, Walgreens is poised to become the biggest pharmacy chain in America. Walgreens' most recent growth spurt started in 2010 when it bought Duane Reade for $1.1 billion. Two years later, it took a 45 percent stake in Swiss pharmacy giant Alliance Boots, then bought the rest in August 2014. Taking the helm of Walgreens Boots Alliance (the clunky-sounding result of this deal) was Italian billionaire Stefano Pessina, who clearly likes to go shopping for more than aspirin and nail polish. Last October, Walgreens announced it was buying Rite Aid for $17.2 billion. If regulators approve the deal, it'll slam together 8,200 Walgreens stores with the 4,600 operated by Rite Aid. Though stores in overlapping territories will most certainly be sold off, the resulting company—inevitably retiring the Rite Aid brand name—would still be the biggest drugstore chain in the land. Much like CVS, Walgreens is already far more than a drugstore. It operates a mail-order pharmacy, a specialty pharmacy, an infusion service and 400 in-store health clinics in 20 states. Walgreens boasts that it has a store within five miles of 75 percent of America. Before long, it could be 100 percent.

This story first appeared in the March 28 issue of Adweek magazine. Click here to subscribe.