Walgreens….. its been good to know ya!
That’s not saying that Walgreens is going away. To the contrary, it is the dawn of a new day for Walgreens, a day when Walgreens fully emerges from the chrysalis of pharmacy leader to a gosh darn, dyed in the wool, integrated health care provider butterfly.
We see the tipping point as the recent full acquisition of CareCentrix for $392million….. oh, that’s on top of the initial investment of $330million earlier in 2022. As you may recall, CareCentrix coordinates home care for health plans, patients, and medical providers which represents 19 million patients in the home setting and approx. 7,400 provider locations.
Other acquisitions over the past year+ are integral to fast-tracking its transition….. in particular, specialty pharmacy developer / manager Shields Health Solutions for a $billion (see our report Oct 13, 2022) and primary care network VillageMD majority share for $5.2 billion. Both are highly complementary to the CareCentrix market. [NOTE: Walgreens-backed VillageMD is exploring a merger with medical practice Summit Health, the parent company of CityMD, according to a Bloomberg report on October 31st. The combined Summit company could be valued between $5 billion and $10 billion, also according to Bloomberg.]
Not to be outdone, CVS announced it was acquiring home care company Signify Health for $8 billion seemingly mirroring Walgreens’ integrated health care provider strategy. And, not to be a wall flower, Amazon acquired One Medical for $3.9 billion earlier this year.