{"id":4668,"date":"2025-07-18T05:23:15","date_gmt":"2025-07-18T05:23:15","guid":{"rendered":"https:\/\/www.newsbeep.com\/ca\/4668\/"},"modified":"2025-07-18T05:23:15","modified_gmt":"2025-07-18T05:23:15","slug":"cvs-snatches-calpers-pharmacy-contract-from-unitedhealth","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/ca\/4668\/","title":{"rendered":"CVS Snatches CalPERS Pharmacy Contract from UnitedHealth"},"content":{"rendered":"

CVS Health (CVS)<\/a> has secured a major healthcare deal, winning a multi-year pharmacy benefits contract with CalPERS, outbidding rival UnitedHealth (UNH)<\/a>. The deal marks a significant win for CVS\u2019s Caremark unit and could shift competitive dynamics in the pharmacy benefits management (PBM) market.<\/p>\n

Elevate Your Investing Strategy:<\/p>\n

Notably, CalPERS (California Public Employees\u2019 Retirement System) is the largest public pension fund in the U.S., serving over 2 million public employees, retirees, and their families in California.<\/p>\n

More Details About the Deal<\/p>\n

CalPERS is moving from OptumRx, a UnitedHealth subsidiary, to CVS Caremark, citing CVS\u2019s more competitive pricing. The pension fund also noted that CVS stood out among other bidders for its strong commitment to managing pharmacy costs and upholding high clinical standards. CVS will take over this role starting January 1, 2026.<\/p>\n

Under the agreement, CVS is required to meet specific cost and quality goals; failing to do so could cost the company up to $250 million in performance-based penalties.<\/p>\n

Meanwhile, the five-year deal will give outpatient prescription drug coverage to around 587,000 CalPERS members, or about 40% of those receiving health benefits through the system.<\/p>\n

CVS vs. UnitedHealth<\/p>\n

CVS Health has made a strong comeback in 2025 after facing several tough years. Year-to-date, CVS stock has gained over 40%.<\/p>\n

Additionally, CVS Health reported strong first-quarter results for 2025<\/a> in May, with revenue rising 7% year over year and adjusted earnings per share jumping to $2.25, up from $1.31 the previous year. The company also raised its full-year adjusted EPS forecast to $6.00\u2013$6.20, up from a prior range of $5.75\u2013$6.00, and now expects to generate about $7 billion in cash flow.<\/p>\n

On the other hand, UnitedHealth has been struggling with multiple challenges. In April, the company reported unexpectedly high medical costs in its Medicare division. By May, it suspended its full-year financial forecast,<\/a> and CEO Andrew Witty stepped down suddenly for personal reasons. So far this year, UnitedHealth shares have fallen more than 40%.<\/p>\n

Which Healthcare Stock Is a Strong Buy, According to Analysts?<\/p>\n

Using the TipRanks Stock Comparison tool,<\/a> we compared these healthcare stocks. Among these companies, CVS stock<\/a> has earned a Strong Buy rating from analysts, while UNH carries a Moderate Buy<\/a>. In terms of share price appreciation, CVS\u2019 average stock price target<\/a> of $81.27 offers an upside potential of 27% from current levels.<\/p>\n

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