CVS Health: Promoting Drug Adherence

Email mking@hbs.edu for a courtesy copy.

This Teaching Note explains the theory of the case and teaching plan for the case: CVS Health: Promoting Drug Adherence (515010). The case finds Helena Foulkes, Executive Vice President, Health Care Strategy and Marketing for CVS Health, advocating for marketing budget to be directed toward the firm’s new Pharmacy Advisor Program (PharmAP), which was designed to boost medication adherence among users of its Pharmacy Benefit Manager (PBM) system. Foulkes had decided to focus her proposal on one ailment to establish a proof of concept for the program and then move to widespread rollout for all chronic ailments. The case requires students to put themselves in Foulkes’ position and conduct analyses required to make a case for funding to the CEO. First, students are prompted to think through the value of medication adherence to CVS and its stakeholders. Next, they determine whether, and if so, how, to improve the program such that it is worth its costs. Students realize that their suggested improvements likely will not be enough to achieve the necessary adherence such that the program breaks even. In the final area of the discussion, students quantify the value of medication adherence to the PBM’s key stakeholders (i.e., payers and employers). The key realization is that the stakeholders derive so much value from the PharmAP that together, they are incented to partner with Foulkes to ‘prime the pump’ to get the next phase of the program off the ground.