Walgreens has tripled down on acquisitions over the past year to the tune of several Billion $$$ in a quest to totally remodel the 122 year old pharmacy giant. So, with several quarters under their belt, is the strategy working? They would likely say….. quite well, thank you.
Here are the highlights from the article below:
- Walgreens Health tops 2.9 million contracted lives….up over 50% year on year
- Village MD now managing 806,000 value-based lives….up over 38% year on year
- Village MD ended the quarter with 729 locations, including Summit Health and City MD including 210 clinics collocated with Walgreens, compared to 94 collocated clinics a year ago.
It is challenging to make comparisons since there are really no other similarly integrated models with the broad scope we see in the WAGS model. That being said, the easiest metric is head count. In a relatively short time WAGS has racked up access to several million lives that come with a tangible degree of control.
It should be no surprise that specialty pharmacy is one area that will increasingly benefit from connectivity with prescribers in the Health division. Unfortunately, it is unlikely that we will see detailed financials that break out specialty revenues from this channel.
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Walgreens Touts Healthcare Transformation As Clinic Acquisitions Quicken
MARCH 28, 2023 — Continuing its transformation from a pharmacy chain to an integrated healthcare platform with a large retail footprint, Walgreens Boots Alliance (WBA) reported progress on its retail clinic initiatives as it saw the effects of COVID fade substantially.
During its fiscal 2023 second-quarter earnings call on Tuesday (March 28) WBA CEO Rosalind Brewer called the second quarter of fiscal 2023 “a landmark quarter for our transformation to healthcare,” pointing to its $3.5 billion investment to support Village MD’s acquisition of Summit Health.
Saying the company is focusing more on “accelerating the build-out of our healthcare growth engine,” Brewer said “the addition of Summit Health is transformational. It creates one of the largest integrated provider platforms in the U.S., delivering quality affordable care for all patient populations, regardless of insurance or payer type.”
Brewer called the acquisition a “highly strategic transaction that expands Village MD’s addressable market with primary care, multi-specialty and urgent care, and reinforces our approach across the entire care continuum.”
WBA has added its fourth payer partner for its organic business, Horizon Blue Cross Blue Shield of New Jersey, and has signed five clinical trial contracts. She added that specialty pharmacy operator Shields Health Solutions and home health provider CareCentrix “both continue to perform well, which led to the accelerated acquisition of both entities. Shields closed on Dec. 28 and CareCentrix is scheduled to close this quarter.”
Chief Financial Officer James Kehoe said Walgreens Health’s organic business had 2.9 million contracted lives up over 50% year on year, with Village MD managing 806,000 value-based lives as the quarter ended, “reflecting year-over-year growth of 38% in the legacy Village MD business and the addition of 309,000 value based lives from Summit Health.”
He noted that Village MD ended the quarter with 729 locations, including Summit Health and City MD. There were 403 clinics for the legacy Village MD business at the end of the quarter compared to 270 at the end of the prior year period, including 210 clinics collocated with Walgreens, compared to 94 collocated clinics a year ago, he said.
