CVS Caremark Corporation (CVS)

Results of Operations

The following discussion explains the material changes in our results of operations for the fiscal quarters ended March 31, 2009 and March 29, 2008 and the significant developments affecting our financial condition since December 31, 2008. We strongly recommend that you read our audited consolidated financial statements and footnotes and Management’s Discussion and Analysis of Financial Condition and Results of Operations included as Exhibit 13 to our annual report on Form 10-K for the fiscal year ended December 31, 2008 (the “2008 Form 10-K”) along with this report.

15

Table of Contents

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Results of Operations

Fiscal Year Change ~ On December 23, 2008, the Board of Directors of the Company approved a change in the Company’s fiscal year end from the Saturday nearest December 31 of each year to December 31 of each year to better reflect the Company’s position in the health care, rather than retail industry. The fiscal year change was effective beginning with the fourth quarter of fiscal 2008. Prior to Board approval of this change, the Saturday nearest December 31, 2008 would have resulted in a 53-week fiscal year that would have ended January 3, 2009.

Results of Operations

The following discussion explains the material changes in our results of operations for the thirteen and thirty-nine weeks ended September 27, 2008 and September 29, 2007 and the significant developments affecting our financial condition since December 29, 2007. We strongly recommend that you read our audited consolidated financial statements and footnotes and Management’s Discussion and Analysis of Financial Condition and Results of Operations included as Exhibit 13 to our annual report on Form 10-K for the fiscal year ended December 29, 2007 (the “2007 Form 10-K”) along with this report.

Effective March 22, 2007, we completed our merger with Caremark Rx, Inc. (“Caremark”). Following the merger with Caremark (the “Caremark Merger”), we changed our name to “CVS Caremark Corporation.” Accordingly, our results of operations for the thirteen and thirty-nine weeks ended September 29, 2007 include 91 and 192 days, respectively, of post-merger Caremark operations.

18

Table of Contents

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Results of Operations

The following discussion explains the material changes in our results of operations for the thirteen and twenty-six weeks ended June 28, 2008 and June 30, 2007 and the significant developments affecting our financial condition since December 29, 2007. We strongly recommend that you read our audited consolidated financial statements and footnotes and Management’s Discussion and Analysis of Financial Condition and Results of Operations included as Exhibit 13 to our annual report on Form 10-K for the fiscal year ended December 29, 2007 (the “2007 Form 10-K”) along with this report.

Effective March 22, 2007, we completed our merger with Caremark Rx, Inc. (“Caremark”). Following the merger with Caremark (the “Caremark Merger”), we changed our name to “CVS Caremark Corporation.” Accordingly, our results of operations for the thirteen and twenty-six weeks ended June 30, 2007 include 91 and 101 days, respectively, of post-merger Caremark operations.

18

Table of Contents

Management’s Discussion and Analysis of Financial Condition and Results of Operations

Results of Operations

The following discussion explains the material changes in our results of operations for the thirteen weeks ended March 29, 2008 and March 31, 2007 and the significant developments affecting our financial condition since December 29, 2007. We strongly recommend that you read our audited consolidated financial statements and footnotes and Management’s Discussion and Analysis of Financial Condition and Results of Operations included as Exhibit 13 to our annual report on Form 10-K for the fiscal year ended December 29, 2007 (the “2007 Form 10-K”) along with this report.

Effective March 22, 2007, we completed our merger with Caremark Rx, Inc. (“Caremark”). Following the merger with Caremark (the “Caremark Merger”), we changed our name to “CVS Caremark Corporation.” Accordingly, our results of operations for the thirteen weeks ended March 31, 2007 include 10 days of post-merger Caremark operations.

Results of Operations

As described above, we completed the Caremark Merger on March 22, 2007 and acquired the Standalone Drug Business on June 2, 2006. As a result, our consolidated condensed results of operations for the thirteen and thirty-nine weeks ended September 29, 2007 include 91 and 192 days, respectively, of Caremark’s results of operations. In addition, our consolidated condensed results of operations for the thirteen and thirty-nine weeks ended September 30, 2006 include 91 and 121 days, respectively, of the Standalone Drug Business’ results of operations.

Results of Operations

As described above we completed the Caremark Merger on March 22, 2007 and acquired the Standalone Drug Business on June 2, 2006. As a result, our consolidated condensed results of operations for the thirteen and twenty-six weeks ended June 30, 2007 include 91 and 101 days, respectively, of Caremark’s results of operations. In addition, our consolidated condensed results of operations for the thirteen and twenty-six weeks ended July 1, 2006 include 30 days of the Standalone Drug Business’ results of operations.

Results of Operations

As described above we completed the Caremark Merger on March 22, 2007. As a result, our results of operations for the thirteen weeks ended March 31, 2007 include 10 days of results of post-merger Caremark operations.