We don’t know, as we don’t know the details of their partnership agreement. However, in their original announcement there was this sentence:
“Additionally, visitors to WebMD will be able to easily use Walgreens' prescription refill and clinic appointment scheduling options from within the WebMD site on their desktop or mobile device”
“In April 2012, Express Scripts completed a $29.1 billion acquisition of Medco Health Solutions. The acquisition positioned Express Scripts Holding Co. as the largest pharmacy benefit manager, filling 1.4 billion annual prescriptions.
Medco was originally founded as National Pharmacies in 1983. In 1984, after an IPO, National Pharmacies became Medco Containment Services, LLC. In 1993, Medco Containment was acquired by Merck & Co., Inc. and became Merck-Medco. In August 2003, Medco Health Solutions, Inc. became an independent company in one of the largest domestic spin-offs at the time.”
And we all know who founded Medco….
Thanks Limp for this relevant information.
It will be interesting to see how CEO Pessina's strategy works with the current and future business relationship with WebMD. It appears that it may become a deeper, and more financially beneficial for both parties.
Walgreens Boots Alliance Inc.’s acting Chief Executive Officer Stefano Pessina isn’t being shy about his ambitions to do more deals, mere months after taking the helm of the biggest U.S. drugstore chain.
On a conference call with analysts Thursday, he outlined options that include a buyout of a company in the drug-distribution supply chain or a joint venture with a partner. Express Scripts Holding Co.’s shares closed up 4.9 percent to $88.47, a record, in New York, as investors interpreted Pessina’s deal comments as a possible overture for the drug-benefits provider, Evercore ISI analyst Ross Muken said.
Walgreens is the only major U.S. retail pharmacy chain that doesn’t own a pharmacy benefit manager like Express Scripts. Such companies negotiate with drugmakers on prices for medications obtained through insurance coverage. CVS Health Corp. bought Caremark RX Inc. in 2007 to enter the business, and Rite Aid Corp. agreed this year to acquire EnvisionRX.
Express Scripts spokesman David Whitrap declined to comment. Walgreens shares rose 5.6 percent to $92.62.
The market appears ripe for another round of consolidation to take costs out of the complicated drug distribution business in the U.S., Pessina told investors on the call after the company reported second-quarter earnings that beat analysts’ estimates.
“The complex structure of delivering the medicines to the patients will have to be rationalized, and as a consequence it’s easy to believe we will have additional synergies coming from M&A activities,” he said. “We want to be -- as we have been in the past -- at the forefront of changes and so if these needs for consolidation will be confirmed, we will try to be part of it.”
His comments may indicate Walgreens is leaning more toward a deal in the industry of buying and distributing drugs than toward a merger with a direct competitor like Rite Aid, which has been the subject of speculation in recent weeks. Walgreens said Thursday it will close 200 U.S. stores this year to cut costs, throwing cold water on the idea that Pessina is eager to gain more locations.
One hint into Pessina’s strategy is the strategic relationship Walgreens entered in 2013 with AmerisourceBergen Corp., the second-biggest U.S. drug distributor. On the conference call Thursday, the acting CEO cited the alliance, which gave Walgreens the option to acquire a minority stake in the distributor, as an example of the type of “innovative partnership” he’d like to do.
“They’re rationalizing their own store base, they’re loving the deal they did with AmerisourceBergen and they’re talking about enhancing the supply chain with M&A,” said Tony Scherrer, director of research at Seattle-based Smead Capital Management, which oversees $1.4 billion and owns Walgreens stock. “If they’re doing that, then perhaps a Rite Aid deal would be less likely than what people had been thinking.”
Walgreens spent $15.3 billion to buy the rest of Alliance Boots in August, after previously controlling about 45 percent of the Swiss company. Pessina built Alliance Boots through more than three decades of mergers before selling it to Walgreens.
While the integration of the two companies continues, it won’t prevent the company from doing more deals, Pessina said. Deals or joint ventures typically take months to come to fruition anyway, he said. Walgreens executives said mergers are a top priority for the company’s cash.
While he hunts for deals, Pessina is also looking for a new leader for Walgreens. The company announced in December its CEO Greg Wasson, 56 at the time, would retire upon the closing of the deal. Pessina, who is also executive vice chairman and the biggest shareholder of Walgreens, is acting CEO while the company selects Wasson’s replacement.
Today, Cerner announced a seamless app in concert with the Apple Watch that bears a very similar resemblance to what I wrote about in a post on this message board back on March 23rd 2014. The title of my post was WebMD & ARTIFICIAL INTELLIGENCE. The only difference is that my post spoke about implantable sensors in the human body vs. the sensors in the Apple Watch capable of monitoring specific vitals. It has only taken one year for Cerner to do what I predicted WebMD was also preparing as part of their new Revenue generating platforms to serve the doctor patient digital interaction!
I think we’ll get some more information before that.
The 1st quarter earnings conference might be used for that as they should inform on the progress of that relationship.
Limp, I believe the conference in June, in France, where WebMD will be participating with the Walgreens- Boots executives may shed more light on the partnership between the 2 companies.
Executive Vice Chairman and Acting CEO Stefano Pessina said, “This quarter marked a solid start for our new company, and I remain as optimistic as ever about our long-term future. At the same time, we understand the work that is needed to proactively address headwinds such as reimbursement pressure and competition. Our work includes several key areas of focus to create value.
“The first area is improving the performance of our businesses worldwide with an emphasis on operations. Second, we will be refreshing and reinvesting in the stores of our Retail Pharmacy USA division to improve the customer experience and expand retail margins. Third, we are restructuring our cost base, with a focus primarily in the USA, to create a more efficient cost model and become a more agile company. Through these efforts, Walgreens Boots Alliance is determined to lead the way in our industry and be at the forefront of innovative, pharmacy-led health care.”
Good advice, fish!
There was such a surge in volume yesterday, it's possible that many traders jumped in on the action during the course of the day and then took profits toward the close.
Regarding the whole thing being staged, I do not think that is the case here, however, I must admit that the reports that have been issued starting in April, were all released after the granting of both stock options and restricted stock to the WebMD senior executives. When you think about timing, if an analyst covering WebMD worked for an investment bank, that was either seeking or currently receiving fees from WebMD for their services, and had written a very favorable report on the company, would that analyst / investment bank release the report before the options grant by WebMD, I don't think so! The most recent options were granted at $42.99 during the last week of March. The favorable report on WebMD came out on April 2, followed by the initial unfavorable report by Goldman yesterday. I won't say that it is a rigged market, however, it does appear to be a chronologically scheduled market.
Don't get too giddy yet , steve....alot of selloff after the high of the day....big volume makes me wonder also...was the whole thing staged ????