Walgreens Takes Bigger $5.2 Billion Stake In Doctor Clinic Partner VillageMD

Walgreens Boots Alliance will make investments one other $5.2 billion into VillageMD to escalate the rollout of tons of of doctor-staffed clinics at its drugstores.

The funding will give Walgreens a 63% stake in VillageMD forward of an preliminary public inventory providing the first care firm plans subsequent yr. Walgreens at present has a 30% stake in VillageMD, a standalone firm that landed a $1 billion funding from the pharmacy big final yr.

The announcement of the $5.2 billion funding got here Thursday as Walgreens new chief govt officer Roz Brewer outlined extra of her technique for the enduring drugstore chain in the course of the firm’s annual investor day when she careworn major care as important to the longer term.

“One of the best healthcare is deeply rooted in native communities, and Walgreens is dedicated to increasing handy entry to high-quality and inexpensive healthcare companies to our sufferers and clients in our neighborhood areas,” Brewer stated. “VillageMD is a pacesetter throughout the fast-growing, value-based major care section with excessive charges of affected person satisfaction and a gifted administration crew who share our strategic imaginative and prescient of the central position that major care can serve to enhance affected person outcomes and decrease prices.”

The bigger funding will enable Walgreens to “speed up the opening of at the very least 600 Village Medical at Walgreens major care practices in additional than 30 U.S. markets by 2025 and 1,000 by 2027, with greater than half of these practices in medically underserved communities,” the corporate stated. Walgreens and VillageMD have greater than 50 major care practices positioned adjoining to or a part of Walgreens shops and can have greater than 80 open by the tip of this yr.

Walgreens major care growth comes as rivals roll out their very own major care expansions. CVS Well being is opening tons of of HealthHub retailer codecs with extra healthcare gadgets and medical companies to enrich its established MinuteClinics staffed by nurse practitioners whereas Walmart is opening extra “Walmart Well being” facilities that characteristic an array of major medical companies, dental care, and behavioral well being companies as a part of a brand new mannequin.

Other than the clinics positioned at Walgreens shops, VillageMD operates doctor practices throughout the nation. VillageMD, which operates greater than 230 practices in 15 markets, this yr will generate $1.3 billion in income, which is six instances the $217 million in income the corporate generated in 2017.

“Walgreens funding helps our ongoing dedication to offering the best high quality healthcare to all sufferers, together with many individuals who don’t at present have handy entry to a major care supplier,” VillageMD chairman and chief govt Tim Barry stated. “This expanded partnership helps us speed up our mission to ship one of the best healthcare on this planet.”