Daily Management Review

95 Million Less Cigarette Packs Sold After CVS Tobacco Ban in Its Retail Pharmacy Stores


09/03/2015




95 Million Less Cigarette Packs Sold After CVS Tobacco Ban in Its Retail Pharmacy Stores
An analysis of the retail market data in the US by CVS Health shows that there has been a reduction of reduction of at least 95 million packets of cigarettes at “all retailers” of the pharmacy giant after the company stopped selling tobacco products a year ago.
 
The pharmacy giant claimed to have proved wrong claims by a section of analysts that Americans find cigarettes elsewhere even if the drugstore giant ceased tobacco sales even after CVS Health stopped tobacco selling through its outlets.  A company statement claimed that apart from increased taxes on cigarettes and curbs and restrictions on advertisements, the reduction of tobacco consumption solely by stopping of sales by a company is unprecedented.
 
The company had stopped selling tobacco in September 2014 through all of its retail outlets.
 
“Those who were saying it won’t make any difference because those people will get cigarettes elsewhere were wrong,” Dr. Troyen Brennan, chief medical officer at CVS Health said in a recent interview.
 
Interviews, bar code data and related examinations of tobacco sales at gas stations, rival drug stores, grocers and convenience stores in 26 states were used in the analysis that used data from market research from IRI. All the data were collected after CVS Health stopped selling tobacco from September 3, 2014.
 
Just a week ago, the Centers for Disease Control and Prevention had issued data that indicated that the US smoking rate had dropped to 15 percent in the first quarter of 2015 from a corresponding period rate of 16.5 percent in 2015.
 
Experts of public health predict that the CVS’ tobacco ban played a part in bringing down the national smoking rate in the last one year.
 
In at least 15 states of the country where CVS had 15 percent or more of the retail pharmacy market share, the rate of sale of cigarette packs has reduced by at least one percentage. This came out from a comparison of states that had a significant number of VCS stores and those that had less.
“It’s a modest difference, but it’s in the right direction. It’s harder now to buy cigarettes. Some people may have stopped smoking and some people may be smoking fewer cigarettes,” said Dr. Steve Schoreder, professor of medicine at University of California San Fransisco who heads the school’s Smoking Cessation Leadership Center, in an interview about CVS tobacco ban and its analysis.
 
The company suffered a loss of $2 billion in annual sales after stopping sale of tobacco and related products. However the company made up this from its new business from the Affordable Care Act, its growing pharmacy benefit management business and other health-related revenue.
 
The company however gained otherwise in terms of revenue after it stopped sale of tobacco. A four percent increase in nicotine patch purchases in the 26 states where the pharmacy chain had a market share of 15 percent or greater was noted as well as the average number of visits to its MinuteClinic retail clinics for smoking cessation counselling “nearly doubled” after the decision to stop tobacco sale by the company.

“We reasoned that removing a convenient location to buy cigarettes could decrease overall tobacco use. This new data demonstrates that CVS Health’s decision to stop selling tobacco did indeed have a real public health impact,” Brennan said.

(Source:www.forbes.com) 






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