(This story is from our new Health Tech newsletter. If you’d like to sign up, just click here.)
Walgreens said Thursday it’s getting into cell and gene therapy pharmacy services and bringing its specialty pharmacy under a new name as it navigates the future of its business.
In addition to setting up a cell and gene therapy facility, Walgreens is taking its existing specialty pharmacy-related businesses, like community pharmacies that are located near or inside a health system, and putting them all into one division: Walgreens Specialty Pharmacy. Ideally, the rebranded specialty pharmacy business can better work with enterprise partners like health plans, pharma and providers as a competitor to PBM-owned specialty pharmacies.
Walgreens has leaned into its core pharmacy business under CEO Tim Wentworth, who joined the organization in October. In March, the company took a $5.8 billion charge from its investment in primary care operator VillageMD, and Walgreens has plans to close 160 VillageMD clinic locations. VillageMD was one of several efforts to expand Walgreens’ revenue streams beyond its retail pharmacy business as rival organizations did the same.
Rick GatesWalgreens chief pharmacy officer Rick Gates told Endpoints News he expects this to be the first of multiple investments into the company’s specialty pharmacy business.
“You’re going to see investments in the core of pharmacy, both specially and within the retail side, to continue to evolve in a way that we can have a bigger impact on the touchpoints that we have,” he told Endpoints, noting that includes the company’s in-store and online presence.
Walgreens’ Shields Health Solutions, a specialty pharmacy business that works with health systems, is remaining separate from the new specialty pharmacy division. In January, Bloomberg reported that Walgreens was exploring a sale of the Shields business that values it at more than $4 billion. But in March, Wentworth said there were no plans to sell.