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Merck, CVS set Net pact
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October 6, 1999: 8:04 a.m. ET
Drugstore, benefits plan to offer one another's services on Web sites
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NEW YORK (CNNfn) - Merck & Co., the nation's biggest drug maker, and No. 2 drugstore chain CVS Corp. agreed Wednesday to a marketing alliance aimed at the growing number of people buying health care products online.
Under the deal, CVS's online division will be the sole provider of over-the-counter medicines and personal care products to online customers of Merck-Medco Managed Care LLC, Merck & Co.'s (MRK) prescription drug management unit with about 51 million members. CVS, the No. 2 drugstore chain after Walgreen Co. (WAG), will accept prescription orders from Merck-Medco members over the Internet, the only retail pharmacy to offer such a service.
Financial terms were not disclosed.
The pact also makes CVS's specialty pharmaceutical unit, ProCare, the sole provider of some pharmacy mail order services for Merck-Medco members. As part of the deal, Merck-Medco is buying up to 10 percent of ProCare.
Merck-Medco, based in Franklin Lakes, N.J., said the deal will allow its customers to "one-stop shop" online for all of their pharmacy needs.
CVS said the deal will help expand its reach in the western United States, where many of Merck-Medco's customers live. CVS, based in Woonsocket, R.I., does not have retail stores in that region.
CVS (CVS) stock lost 1/8 to 37-1/16 while Merck edged up 7/8 to 70-1/8 Tuesday.
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