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☕️ Testing the waters
To:Brew Readers
Healthcare Brew // Morning Brew // Update
CVS is experimenting with small-format stores, following Rite Aid’s lead.

It’s Wednesday again, and New York City-based investment firm Deerfield Management is shelling out the big bucks for healthcare. The firm announced this week the closing of its third healthcare innovations fund, with more than $600 million set to go toward “promising therapeutics” as well as emerging technologies like AI. Raise your hand if you could use a million or two.

In today’s edition:

The Rite Aid model?

Hospitals prep for tariffs

April’s exec moves

—Maia Anderson, Cassie McGrath, Caroline Catherman

RETAIL PHARMA

A CVS pharmacy stands in a Brooklyn neighborhood in New York City.

Getty Images

CVS is getting experimental.

The retail pharmacy giant confirmed in March plans to open a dozen small-format pharmacies in “select communities nationally” by the end of 2025. The stores will be less than 5,000 square feet on average, with a full pharmacy and limited over-the-counter items, CVS spokesperson Amy Thibault said in a statement sent to Healthcare Brew.

“The new pharmacies will be introduced in select neighborhoods to help bridge gaps in care and make it easier for patients to access medications, immunizations, and other pharmacist-provided healthcare services,” Thibault said.

CVS is in a period of change as it attempts to course correct from 2024, when its net income plummeted 45% from $8.4 billion to $4.6 billion. Other recent developments include naming new executives and announcing a potentially lucrative partnership with Novo Nordisk.

However, some analysts don’t think the small-store experiment will make a big splash for CVS.

For more on CVS’s small-format strategy, click here.—MA

Presented By Calm

HOSPITALS

How the supply chain has been affected by tariff rumors

Francis Scialabba

Hospitals have been rocked by supply chain challenges in recent years, from cost increases for personal protective equipment (PPE) during the Covid-19 pandemic to IV fluid shortages following hurricanes in North Carolina.

Now, with 145% tariffs on China—and possibly more coming—hospitals are gearing up for additional disruptions.

Products can be costly, as market intelligence company Definitive Healthcare reported earlier this year. In 2023, hospitals spent $57 billion on medical and surgical supplies—up 6.5% from 2017’s $30.2 billion, according to the report.

Hospitals and health systems must have enough of the right medicines, medical devices, and supplies at the right time to provide “safe and effective care,” Akin Demehin, VP of quality and safety policy at the American Hospital Association (AHA), told Healthcare Brew.

“It’s why they care so much about what the supply chain looks like, and put so much effort into trying to understand and manage the supply chain,” he added.

Keep reading for more on potential hospital supply chain issues.—CM

EXEC MOVES

Healthcare Brew's August on Rotation editorial feature

Francis Scialabba

Wondering who’s in and who’s out at major health companies, startups, hospitals, and more?

We’ve got you covered. Welcome to April’s On Rotation!

Here’s a noncomprehensive roundup of the past month’s career shifts.

Have a job announcement to share? Drop Caroline an email at [email protected].

Kristi Baker: The former VP of women and children services at Saint Francis Health System in Tulsa, Oklahoma, is now senior executive officer of Orlando-based AdventHealth for Children effective April 7. In her role, she will oversee the health system’s full Florida pediatric care network.

Raj Chopra: After five years as venture partner and head of oncology at life sciences venture capital firm Apple Tree Partners, Chopra is moving on to become chief scientific officer at Flagship Pioneering-founded Prologue Medicines, the biotechnology company announced April 8.

See the latest roundup here.—CC

Together With Indeed

VITAL SIGNS

A laptop tracking vital signs is placed on rolling medical equipment.

Francis Scialabba

Today’s top healthcare reads.

Stat: 2,400. That’s roughly how many healthcare workers ended a nearly seven-month-long strike with Kaiser Permanente over the health system’s mental health care practices. (NBC 7)

Quote: “A little like going to the Kentucky Derby and putting all your money on one horse. In science we normally put money on a number of different horses because we can’t be entirely sure who’s going to win.”—William Schaffner, a professor of preventive medicine and health policy at Vanderbilt University School of Medicine, on HHS’s $500 million investment in a single flu shot candidate (KFF Health News)

Read: Could this immunotherapy be the future of cancer treatment? (CNN)

A doctor walking along digital health data and a woman sitting at two computers in front of hospital beds

Jason Solo

From paper charts to patient portals, the last 25 years have transformed healthcare. Healthcare Brew explores the milestones, innovations, and challenges that reshaped the industry—and what’s ahead.

Explore the last 25 years in healthcare

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