CVS Health says loss of Blue Shield business has no significant impact on longer-term outlook, stock down 8%

CVS Health Corp.
CVS,
-8.14%
expects a major health insurer’s decision to reduce its reliance on CVS Caremark pharmacy benefit manager services will have “an immaterial impact on our longer-term outlook” and no impact on 2023 guidance, the company said in a statement Thursday. Blue Shield of California, a nonprofit health plan, said earlier Thursday that it would work with several new organizations as part of an overhaul of its prescription-drug benefit strategy but retain CVS Caremark for specialty pharmacy services for members with complex conditions. Specialty pharmacy now accounts for over 50% of pharmacy benefit spending in the marketplace, CVS said, adding, “we remain confident in the value we provide our customers and that our integrated solutions will continue to resonate in the marketplace.” Blue Shield’s move weighed heavily on shares of CVS and other major PBM operators, as CVS stock dropped 8% Thursday and Cigna Group
CI,
-6.38%
stock fell more than 6%. Some analysts said the reaction was overblown. “We are skeptical this model will gain widespread traction,” Mizuho Securities analysts wrote in a report on the Blue Shield move, adding that they would be buyers of CVS and Cigna shares on the day’s weakness.