While we are never happy to lose any client, we never plan for 100% retention – it’s the nature of the business. We maintain good pricing discipline; if we retained 100% of our contracts, you might start to question that discipline. We were notified in the first half of May that GE would be transitioning its PBM business to Optum for 2017 (but bound by client confidentiality). This loss was contemplated in Larry Merlo’s public remarks at the UBS Health Care Conference on May 24th, when he stated that, while it's early, our 2017 selling season is off to a very good start even when taking into account recent contract losses.
Keep in mind that the size of the GE contract is dramatically smaller than when we initially won it (now less than $350 million annually – far less than half its initial size). They have transitioned their retirees onto the exchanges over the past couple of years and downsized their U.S. employee base while growing their business overseas. As for CalPERS and ERS, these contract losses are admittedly higher profile having been bid in the public space, and both have been to Optum as they try to get some wins under their belt (keep in mind that these were bid and scored long before the WAG partnership was announced). But I wouldn’t read anything deep into the losses.
Our integrated model continues to resonate strongly as we maintain high levels of service across our diverse client base. Consistent with our past practices, we will provide a quantitative update on our next earnings call once we are further along in the selling season.
They all hate CVS. They say you have to wait 30 minutes to an hour to get your prescription even when you use the app to pre-schedule pick-up. And they said they are way over-priced. One guy said CVS was going to charge him $40 for a drug using insurance, that he could get at Wal-Mart for around $4 or $9 without insurance. Another guy said the store was always dirty and that he has been to at least 4 or 5 different ones. They also said they don't have to wait for their medicine at Walgreens, plus Walgreens is open 24 hours. How does CVS compete? I need some serious answers. :0(
Certainly someone besides me is concerned about this. If earnings were so good that it went up on earnings, why has this stock fallen so much since then? Amazon isn't planning on selling prescriptions are they? Is it going down because politicians are going to put a cap on drug prices? Did Walgreens place a bid on calPERS, too? Was winning of the calPERS bid expected & priced into the stock at the time of earnings, and yet losing the bid was completely unexpected?
The stock should have soared today after being down every day and the market soared today. Where's the floor on this stock?
I sold Cisco Systems for this peice of #$%$ because starbucks was finally down at what appeared to be a decent price. Then it tanked on me and Cisco just soared to the moon.
It's going lower & lower and no one has said a word. Am I the only one with a thinking brain around here? Everyone's losing money on this stock, yet they would rather talk about something else.