CVS Gets Hit Again

There's a constant stream of bad news coming out of CVS Caremark Corp.

The latest: Connecticut alleges the drug-store chain sold products past their expiration dates less than a month after the company settled with New York over similar charges.

CVS sold expired products like baby formula, cold medicines, milk and eggs in at least 20 of its Connecticut stores, the state's attorney general Richard Blumenthal says.

"Basic business law and ethics give consumers a right to unspoiled food and safe and effective medicine," Blumenthal says in a statement.

The company says it's diligent about removing expired products. Still, the New York settlement cost the company $875,000.

The drug-store chain is taking a hit to its image as state attorneys general investigate business practices. Meanwhile, investors are concerned about contract losses in the company's Caremark division. Shares of the company plunged 17 percent in the past three months.

Blumenthal also is investigating CVS, Walgreen Co. and Rite Aid Corp. over alleged price gouging on the flu drug Tamiflu. That probe sparked a consumer warning from federal Health and Human Services officials.

But it's not just CVS's business practices that are being questioned. Moody's Investors Service signaled last week its concern over losses in the Caremark pharmacy benefits management business.

In November, CVS said Caremark lost $4.8 billion in 2010 contracts. Moody's changed its outlook on the company from "positive" to "stable."

"Moody's will need to feel certain that the lost contracts were due to correctable missteps by the company and are unlikely to recur prior to taking any positive rating action," the rating agency said.