(Updated with stock price.)

NEW YORK (

TheStreet

) --

CVS Caremark

(CVS) - Get Report

won a new $1 billion contract with the Teacher Retirement System of Texas to provide pharmacy benefits for two years, according to a report.

The news sent shares of the drug store climbing 2.4% to $32.26 in morning trading.

According to the

Wall Street Journal

, the contract will begin in September 2010, and is valued at $480 million in 2011 and $518 million in 2012. The deal allows for as many as four optional one-year renewals

Last month the drug store said its pharmacy benefit-management unit

lost $2 billion worth of contracts

.

CVS said it lost a contract worth $1.7 billion to provide prescriptions to "dual eligible" people who receive both Medicare and Medicaid benefits, as well as another $300 million in similar contracts with the New Jersey state Blue Cross plan and Ohio's managed Medicare business.

At the time CEO Tom Ryan said CVS would not likely meet its own 2010 profit forecast because profits at its pharmacy benefits management unit Caremark could tank by 10% to 12%.

CVS acquired Caremark in March 2007, and it makes up about half of the company's revenue.

-- Reported by Jeanine Poggi in New York.

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