CVS pharmacy’s decision last year to pull tobacco from its 7,800 stores is paying off, business-wise, and now it’s earned the chain’s CEO a prime seat at Tuesday’s State of the Union Address.
Larry Merlo, who took the helm in 2011, oversaw the chain’s rebranding in September into “CVS Health.”
Most notably, it became the first major pharmacy company to stop selling cigarettes and other tobacco products.
At the time, the White House praised the move as “a powerful example that we hope others in the industry will follow.”
Mr. Merlo, 59, of East Greenwich, R.I., will be seated in the same box Tuesday as First Lady Michelle Obama and Jill Biden, wife of Vice President Joseph R. Biden, during President Obama’s speech late Tuesday,
Eliminating tobacco sales was a calculated risk for CVS, which faced hoped its deeper foray into health care would offset its loss in front-of-store sales. A Bloomberg report in August pegged annual revenue from tobacco sales at about $2 billion.
Yet even as the cigarette ban set in, the company posted a 9.7 increase in revenue for the third quarter last year, the Wall Street Journal reported.