US store CVS sets precedent by ending sale of tobacco products

The store was praised by President Obama

A CVS pharmacy in the New York. The chain announced that it will stop selling tobacco products by October 1, 2014.

The US shop CVS will stop selling tobacco products at its 7,600 stores by next autumn, the company said on Wednesday, making it the first national drugstore chain in the US to take cigarettes off the shelves.

Public health experts hailed the decision by the drugstore as a step that could see other retailers to follow suit.

Some US cities, including Boston and San Francisco, already ban the sale of tobacco products in pharmacies, and nonsmoking advocates hope other chains will follow CVS.

Only 18 percent of US adults smoke, down sharply from 43 percent in 1965. But the habit still kills 480,000 Americans each year, remaining the leading cause of preventable death in the country.

President Barack Obama, a former smoker, praised the retailer.

He said in a statement that the move will help wider efforts to “reduce tobacco-related deaths, cancer, and heart disease, as well as bring down healthcare costs.”

CVS predicts the move will hurt profits initially, along with a $2 billion hit to annual sales. But the company, whose Caremark unit is a pharmacy benefits manager for corporations and the US government's Medicare program, believes the move will boost its appeal as a healthcare provider.

CVS hopes to replace some sales through signing up customers to smoking cessation programs, which will be a selling point with potential corporate contracts.

Pharmacists have long been a source of community health information, and drugstore chains have embraced that tradition by adding walk-in clinics. CVS is the largest US pharmacy healthcare provider, with more than 800 MinuteClinic locations.

A woman smokes a cigarette. Experts hope that CVS has set a precedent that will help cut smoking in the US (Getty Images)

“I think CVS recognized that it was just paradoxical to be both a seller of deadly products and a healthcare provider,” US Centers for Disease Control and Prevention Director Thomas Frieden said.

CVS Caremark Chief Medical Officer Dr. Troyen Brennan said in a piece in the 'Journal of the American Medical Association' that increased health coverage under the US Affordable Care Act “comes with a price” of promoting public health.

Experts noted that healthcare organizations and advocacy groups such as Americans for Nonsmokers' Rights have been urging pharmacies for years to get out of the tobacco business.

“This is a trend we're going to see many, many retailers and food companies jump on,” said Alexandra von Plato, president and global chief creative officer of Publicis Healthcare Communications Group.

Tobacco companies shrugged off the announcement even as shares dipped on concerns about potential disruption to sales.

“It's up to retailers to decide if they're going to sell tobacco products,” said Brian May, spokesman for Altria Group , maker of Marlboro and other popular brands.

RBC Capital Markets analyst Nik Modi said he expected little impact on tobacco companies. He noted that they rely on convenience stores for more than 75 percent of sales.

But Dr. Richard Wender of the American Cancer Society said CVS's move would have an effect.

“Every time we make it more difficult to purchase a pack of cigarettes, someone quits.”

Reuters