Walgreens Boots Alliance reinforced its intention to become a bigger player in the healthcare ecosystem Thursday with plans to further expand its Walgreens Health division, which includes VillageMD.
Walgreens Boots Alliance CEO Rosalind Brewer told analysts during the company’s fiscal third quarter earnings call the pharmacy retail giant is on the hunt for an acquisition in the coming months that will push the company further into the community and customers’ homes.
“We are constantly looking through the marketplace, particularly in tech enablement,” Brewer told analysts during the call. “As we mentioned early in the year, we will have one additional, significant advancement in Walgreens Health on the acquisition side and we remain committed to that in order to really come full circle in that space.”
Walgreens Health is playing an increasingly larger role in the company. The division helped offset a slump in retail pharmacy sales in the most recent quarter — ending May 31 — as demand for COVID-19 vaccinations plummeted from the previous year. Walgreens Boots Alliance reported disappointing earnings of $289 million ($0.33 per share) compared to profits of $1.2 billion ($1.38 per share) during the same period last year.
One bright spot was Walgreens’ 63% stake in VillageMD, which provides in-store and in-home primary care. Sales increased nearly 70% year over year to more than $511 million. The company currently operates 120 VillageMD clinics in its stores nationwide, with plans to open another 80 by the end of the year.
Walgreens, CVS Health and Rite Aid are all transforming themselves from traditional retail pharmacy chains to more holistic healthcare providers. In addition to VillageMD, Walgreens is also buying a majority stake in Carecentrix, a home-centered platform that coordinates the delivery of durable medical equipment and home infusion.
CVS Health operates in-store Minute Clinics, virtual primary care and owns health insurer Aetna. Last month, Rite Aid announced a partnership with rural healthcare provider Homeward that will connect pharmacists in 17 states to Medicare-eligible customers.
