CVS Health Reports Dramatic Drop in Prescription Drug Trend to 5%, Despite Rising Drug Prices

PRESS RELEASE

WOONSOCKET, R.I.

,

Feb. 23, 2016

/PRNewswire/ --CVS Health (NYSE: CVS) today announced that prescription drug trend, a measure of growth in prescription spending, for CVS Health pharmacy benefit management (PBM) clients dropped dramatically to 5 percent in 2015 from a high of 11.8 percent in 2014. While the trend drivers including brand, specialty and generic price inflation were similar to what was seen in 2014, CVS Health's proactive pharmacy management strategies were successful in mitigating the impact of rising drug costs in today's highly volatile prescription drug market.

Price inflation in non-specialty brands outweighed all other trend drivers. As a driver, specialty overall, including the impact of new launches and increases in price and utilization, had less impact than inflation of brands in high volume categories such as drugs used to treat diabetes.

"The high cost of drugs that our clients are struggling with hurts everyone," said Troyen A. Brennan, MD, Chief Medical Officer and Executive Vice President of CVS Health. "Millions of people depend on us for the prescriptions they need to stay healthy. At CVS Health, we work to help patients avoid unnecessarily expensive medications as part of our focus on making prescriptions affordable."

CVS Health is a health care company with innovative products and services that improve patient outcomes and make health care more affordable for patients, employers, health plans and government payers. CVS Health is uniquely positioned to address cost drivers across the health care continuum, enhance access to affordable medications, drive better health outcomes and reduce costs for the millions of patients the Company serves.

CVS Caremark, the Company's PBM, applies a variety of these solutions to help manage pharmacy costs and is focused on ensuring patients have access to the right drugs at the lowest cost. For example, CVS Caremark offers flexible formulary options, based on clinical evidence, that help deliver lower costs for clients while ensuring their members have access to the medications they need. On average, CVS Caremark clients utilizing the Company's value formulary in 2015 saved

$20 million

or more depending on the number of plan members they support. In addition, recently published research from the CVS Health Research Institute showed that along with cost savings, more selective formulary design improves medication adherence and health outcomes.

"The double-digit drug trend increases we were experiencing in 2014 resulted in a call to action from our clients to help them ensure their plan members could access the medications they need to stay healthy, at an affordable price," said

Jonathan Roberts

, President of CVS Caremark and Executive Vice President of CVS Health. "Our programs were effective and successful, as shown by the dramatic drop in overall drug trend last year, and moving forward, we will continue to focus on identifying key drug trend drivers in real time and quickly deliver flexible solutions to our clients that result in additional cost savings for clients while improving the health of their plan members."

Prescription drug trend is the measure of growth in prescription spending per member per month (PMPM). Trend calculations take into account the effects of drug price, drug utilization and the mix of branded versus generic drugs as well as the positive effect of negotiated rebates on overall trend.