CVS Health to Implement New Drug Pricing Model in 2025

The CVS CostVantage model aims to increase transparency and predictability in drug pricing, potentially leading to customer savings.

CVS Health announced a new reimbursement model for its pharmacies, named CVS CostVantage, which will make drug pricing more transparent and predictable.
The new model will determine drug prices and reimbursement with pharmacy benefit managers (PBMs) and payors using a formula that includes the cost of the drug, a set markup, and a fee for pharmacy services.
The changes are expected to launch for commercial payors in 2025 and could lead to some savings for customers starting next year.
The move comes amid scrutiny of high drug prices and the lack of transparency in the pricing process, with CVS's new model resembling the pricing model implemented by Mark Cuban's Cost Plus Drugs company.
CVS Health also announced a 10% hike in its quarterly dividend and forecasted a revenue of at least $366 billion for 2024.