CVS closed its $70 billion acquisition of health insurer Aetna in November. In addition to the price CVS paid to buy the company, it will need to spend money integrating the insurer and bringing its vision for the combined company to life.
Executives warned investors at the J.P. Morgan Healthcare Conference in January that CVS would face more headwinds than tailwinds this year, such as pricing and reimbursement pressures and the need for increased investment.
Merlo in a statement Wednesday said the company is “fully aware” it will need to address challenges that will affect its financial results this year.
“We understand acutely the importance of balancing near-term execution with longer-term vision, and we are confident that our actions will position us well in 2020 and beyond,” he said.
Last week, CVS unveiled its HealthHUBs, or concept stores that contain fewer traditional drugstore items like greeting cards and more health services like blood draws and health screenings. CVS has said the combined company has a capital expenditure of about $2.6 billion annually it can use to remodel stores.