CVS Health bulks its board up to 16 members, adds hedge fund CEO
FILE - A sign marks a CVS branch on Tuesday, May 16, 2023, in Pasadena, Calif. (AP Photo/Marcio Jose Sanchez, File)[ASSOCIATED PRESS/Marcio Jose Sanchez]
CVS Health has added four new board members, including the CEO of a hedge fund that has been critical of the struggling health care giant.
The company said Monday that it expanded its board to 16 members following “productive discussions” with shareholder Glenview Capital Management.
The hedge fund holds about a 1% stake in the company according to the data firm FactSet.
Glenview has said CVS Health, which has cut its forecast several times this year, is operating well below its potential.
Glenview CEO Larry Robbins will take a seat on the CVS Health board. The company also will add H2 Health Chairman and CEO Guy Sansone, OneMain Holdings Chairman Doug Shulman and Leslie Norwalk, a former acting administrator with the Centers for Medicare and Medicaid Services.
The additional board members “will add new thinking and deep market and industry experiences as we focus on driving greater financial and operational performance,” CVS Health Executive Chairman Roger Farah said in a statement.
The additions shouldn’t be surprising after Glenview acquired its stake and made public comments on the company, Leerink Partners analyst Michael Cherny said in a note.
He added that the board expansion doesn’t change anything “beyond where we think CVS had already started to point the ship.”
Woonsocket, Rhode Island-based CVS Health Corp. runs one of the nation’s largest drugstore chains and a huge pharmacy benefit management business that operates prescription drug coverage for employers, insurers and other big clients. It also covers nearly 27 million people through its Aetna insurance arm.
The company has been focused on repairing its insurance business, which has dragged on its overall performance for several quarters. It’s also operating under new leadership, with long-time company executive David Joyner replacing Karen Lynch as CEO last month.
Company shares, which have been down most of this year, climbed more than 3% to $54.96 in morning trading Monday.
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