CVS announces sudden exit of CEO Karen Lynch
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CVS Health on Friday announced the sudden ouster of its CEO Karen Lynch as the company grapples with turmoil that could culminate in the company breaking up.
Why it matters: As the 10th largest company in the world by revenue, CVS is a powerful force in health care and retail with more than 9,000 pharmacies, 1,000+ walk-in clinics and over 300,000 employees.
Driving the news: Lynch is out less than four years after she got the job.
- David Joyner, who was serving as president of pharmacy benefits manager with CVS Caremark and as executive VP of CVS Health, will become CEO.
- The company also elevated chairman Roger Farah to executive chairman.
Catch up quick: CVS is reportedly weighing a breakup plan that could separate the company's Aetna insurance business and its retail pharmacy division.
- Aetna is facing rising medical costs, much like its industry peers.
- PBMs like Caremark are under bipartisan fire from regulators, consumer watchdogs and lawmakers for their role in elevating drug prices.
- Pharmacy competition is intensifying, and the company's non-drugs retail business is struggling to maintain its relevance as consumers increasingly look elsewhere for everyday items.
What they're saying: "The Board believes this is the right time to make a change, and we are confident that David is the right person to lead our company for the benefit of all stakeholders, including customers, employees, patients, and shareholders," Farah said in a statement.
Zoom out: The news comes a year after Walgreens ousted CEO Roz Brewer.
Our thought bubble: Finding a leader adept in digital and physical retail and healthcare is not an easy task, Axios' senior business reporter Hope King writes.
What we're watching: With these high-level departures the progress of growing the number of women leading Fortune 500 companies remains stalled.
Axios' Hope King contributed reporting.
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