NEW YORK — Drugstore operator and pharmacy benefits manager CVS Caremark Corp. said Monday that Larry Merlo will succeed Thomas Ryan as CEO on March 1, about two months earlier than expected.
CVS Caremark said Merlo has been working with Ryan for months and is ready to be the company's CEO. Merlo was president of CVS's pharmacy operations for a decade and was promoted to president and CEO in May 2010. Last week, the company announced two executives would take over for Merlo on a temporary basis.
Last May, the company said Merlo would replace Ryan as CEO after its May 2011 shareholder meeting.
The Woonsocket, R.I., company also said former AT&T Chairman and CEO David Dorman will become the non-executive chairman of its board of directors. Ryan will remain executive chairman until this year's shareholder meeting.
Ryan, 58, is the only CEO and chairman CVS Caremark has ever known. He became president and CEO of CVS Pharmacy in 1994 and oversaw the company's combination with pharmacy benefits manager Caremark in 2007. He has been with the company for about 36 years.
Aside from the $26.5 billion CVS-Caremark deal, Ryan helped expand the company's operations into the South, West Coast and Midwest with a series of acquisitions and began a relationship with walk-in clinic operator MinuteClinic, which CVS Caremark later acquired.
The combined company now runs about 7,100 stores, and it is the third largest pharmacy benefits management provider in the country. About 500 of its stores have MinuteClinics.
Merlo was promoted to CVS' president and chief operating officer in May 2010. Merlo, 55, had been head of CVS' retail operations since 2000. The company has been searching for a new retail president, and in December, it settled on former Wal-Mart executive Hank Mullany. However CVS decided to resume its search last week after a lawsuit from Wal-Mart prevented the hiring of Mullany. For now, executives Mike Bloom and Scott Baker will lead the pharmacy business.
Dorman, the incoming chairman, has been on CVS's board since 2006. He was chairman and CEO of AT&T from November 2002 to November 2005. He is also non-executive chairman of Motorola Solutions Inc., and CVS said he worked in the telecommunications industry for 28 years. Dorman was a managing director with private equity firm Warburg Pincus for about two years.
CVS Caremark shares slipped 4 cents to $35.37 in morning trading Monday.