
CVS turned a tobacco ban into a financial win - dpflan
https://www.linkedin.com/pulse/courage-business-counts-how-cvs-turned-tobacco-ban-financial-sinek/
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wrs
He missed a piece of the story. Caremark (the pharmacy benefit manager owned
by CVS) also introduced an optional pharmacy network that increases copays at
pharmacies that sell cigarettes -- that is, pretty much every retail pharmacy
other than CVS's. [1] Whether this is just more "Courage to Lead", or a genius
ploy to increase CVS's retail pharmacy revenue, or both, I leave you to
consider.

[1] [https://www.drugchannels.net/2014/10/thoughts-on-
caremarks-n...](https://www.drugchannels.net/2014/10/thoughts-on-caremarks-no-
tobacco.html)

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lacker
I’m disturbed by the author treating Jim Cramer as a representative of serious
Wall Street opinion. There’s no real evidence here that it was a good decision
- all sorts of things go into the stock price.

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nirav72
I use to do some day trading. The joke among the day trading community in
those days was that if Kramer recommends buying into a company, then usually a
good idea to do the opposite.

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mattmaroon
That's probably true due to the size of his megaphone. Even if all his advice
was great, his recommending a stock could quickly drive the price up to where
it wasn't great anymore.

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radarthreat
No, his secret is that he'll praise a stock one week and pan it the next (or
vice versa) so that he can cherry pick his 'wins' later.

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mattmaroon
Ha, that's pretty smart.

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sudosteph
I worked at a CVS in high school, and tobacco products were definitely a huge
percentage (30%-ish) of transactions back then. But at the time, my CVS was
also the only easily accessible destination for people in town without cars to
buy those products. And it was a college town too, so there were plenty of
those folks.

I do think that getting rid of tobacco products helps the brand image though.
It always took longer to get customers through a line when you had to find
their particular brand out of 30. It's also true that many of the customers
buying tobacco were noticeably lower-class, so I could imagine this change
making middle class and higher people more into CVS (sort of like the Target
vs Walmart divide).

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smelendez
Nicotine patch sales are growing and cigarette sales are declining in general
in the US. There's not enough evidence or analysis here to show CVS made a big
difference. Also remember this was a time where vape shops were popping up
everywhere and people were switching from cigarettes to e-cigs.

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jondwillis
They also quote the stock price and earnings per share as evidence for the
decision being positive. But their quote was over a very bullish period for
equities, without providing contrast versus other similar publicly traded
companies, nor context (including: CVS’ higher than average share buybacks in
part fueled by tax cuts)

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thaumaturgy
> _They also quote the stock price and earnings per share as evidence for the
> decision being positive._

No, actually. There's a tiny but important distinction here: the author is
merely saying that there was a certainty that there would be negative effects,
and that the expected negative effects didn't happen.

The author even grants that there isn't a certainty that this decision caused
a positive outcome:

"Of course, there are many other factors that have contributed to CVS’s ...
stock performance."

The article's only point is that ideologues and demagogues often assume with
100% certainty that there will be some negative outcome from some company
changing some policy or another, but that this is a flaw in their thinking,
because they're imagining the market to be something much more limited,
simple, and rigid than it really is.

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hughrlomas
Meanwhile their shelves are flooded with homeopathic "remedies" that appear
legitimate. These items deceive consumers that have been raised to assume
items stocked in a pharmacy have actual medical benefits.

People offload their trust to an authority, a pharmacy, to stock actual
medicine. Just like when they go to a grocery store they expect to buy actual
food and not sawdust shaped and packaged as food.

Try looking for cold or flu medicine, or earache drops at CVS. You will find
the tiny print "homeopathic" on nearly every item being presented on the
shelf. All of them are mimics that have all of the trappings of medicine
(official looking labels, colors, words) but none of the results.

I think this is an ethical failure that is worse than the sale of tobacco,
because it not only dupes people looking for proven medical solutions to say,
their child's earache that bring home a vial of water instead, it also
continues to lend credence to the industry of swindlers and snake oil.

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rubidium
I hear you, but “ethical failure year is worse than the sale of tobacco” is a
stretch. Tobacco killed millions. Homeopathic stuff is typically harmless and
not a major killer.

Also I usually find Tylenol PM just fine at my cvs. Along with benedryl,
ibuprofen and other routine “real” meds.

~~~
Baeocystin
It is 100% fraud, taking advantage of ignorance and selling people false
medicine. There is nothing harmless about that. It prevents people from
seeking real treatments, and there are real long-term consequences to public
health that come along with that.

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lowercased
Will they ever get to the point where they decide to stop selling soda and
junk food as well?

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on_and_off
As somebody that discovered the USA not so long ago, this was one of the
weirdest parts.

Pharmacies carry a lot of stuff that have nothing to do with health and that
includes junk food.

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catalogia
The "pharmacy" is the window/counter in the back of the store. A typical CVS
will contain a pharmacy, but generally the fridge full of cola is not
considered part of that pharmacy. You find similar _" pharmacy within a more
general store"_ arrangements in places like Walmart, many grocery stores, etc.

In other words, Walmart is not a pharmacy but Walmart _has_ a pharmacy.

~~~
soneca
That's true. When searching Google maps, the hours of the "CVS Pharmacy" are
for the actual pharmacy inside the CVS store; which might close early than the
general CVS store (under the term "CVS" only)

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csdreamer7
I remember leaving a CVS at one time. Seeing all the posters and health
products. Then seeing an employee unlock the case for cigarettes. Really felt
like a mixed message.

When I first heard the news I worried it would kill CVS. Tobacco companies at
the time had famous tech company margins. It would really hurt them to do so.
Still do it seems: Phillips Morris operating margin is 38%.

I am really glad it worked out for them. I hate it when other people can smoke
because I can smell it downwind. I can smell it on other people. I could
barely smell it on one guy who said he washed his hands and arms in the
bathroom sink afterwards to avoid others smelling it.

~~~
mehhh
The smell is only part of the problem for nom-smokers, if you spend any
significant time around a person smokibg your clothes will get the smell of
cigarettes embedded.

~~~
csdreamer7
Indeed. If I have to walk through smoke I have to change my clothes or it
gives me a headache.

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nitwit005
Seems a bit odd given that the stores are still filled with alcohol, and they
seem to target the pot smoking crowd with some of the eye drop products.

It seemed pretty clear to me their business was prescriptions and addictions
in one convenient place.

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eth0up
Good fucking grief. Courage? I don't need to regurgitate the discrepancies
mentioned by many here, eg sugar snake oil, junkfood, ALCOHOL etc. I'll
instead infuriate some guardian angels with a less pharisaic perspective on
tobacco. Tobacco is a plant. Its use is not solely relegated to neatly packed,
ugly boxes of pre-rolled toxic cardboard shavings. It can and does take the
form of hand-rolled cigars and snus - which when not consumed fanatically,
have low correlation with disease. Snus is not exposed to heat, neither in
processing or consumption. This results in a product with negligible
nitrosamines. Until a nephilim lands amongst us with enough courage to ban
hotdogs and candybars, public danger thereof will probably exceed that of
snus, if frequency of consumption is proportionate. The same ideology that
impels such extreme measures as botanical bans, has humans suffering for
decades in cages for possessing marijuana; another plant. I will be reasonable
and suggest that one could easily go on a diet of hotdogs, beer and candybars
and fare worse than one who enjoys a daily cigar, and they could do it
shopping exclusively at CVS (not the cigar smoker though, who must shop at
Walgreens and doesn't drink).

A more obscure but significant problem with some tobacco is psychology. The
packaging, quantity and pre-rolling exacerbate it, making it too easy to
effectively smoke a habit, rather than cigarette, ie some smoking is done less
because of addiction and more due to habit. Cigarettes, and in some cases
tobacco, are obviously problematic. Abandoning either rather than banning both
altogether seems reasonable. However, I can no longer buy a cigar at CVS. I
can get Rx for restless leg filled and wash it down with acetaminophen and
beer and Skittles though. Meanwhile, cigars are legal, but CVS is at a higher
level.

I know tobacco can be a problem. Is it a problem? Maybe some applications are
problematic. Well, certainly some are.

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shadowmore
I am in awe of your wordsmithing capabilities and would like to subscribe to
your newsletter.

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RcouF1uZ4gsC
Are people who are happy about this also supportive of pharmacists who don’t
dispense drugs that terminate pregnancies because they have a moral objection?

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oofabz
Yes. I support the right of private enterprise to choose what products and
services they offer.

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stallmanite
Is it cool if they refuse to serve black people then? Where is the line in
your mind?

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oofabz
No, it's not okay for businesses to decide who to serve. That's totally
different than deciding what to serve.

