CVS Health's $69 billion deal with Aetna is one way CVS responded to Walgreens' partnership with Prime Therapeutics — a partnership that makes it unlikely Walgreens will buy an insurance company in 2018, healthcare journalist Bruce Japsen wrote in Forbes.
Here are three takeaways from the report.
1. Walgreens extended its relationship with Prime, a pharmacy benefit manager owned by 18 Blue Cross and Blue Shield health plans, in 2017. The partnership reflects one reason Walgreens hasn't pursued an acquisition of a pharmacy benefit manager, according to the report.
"Though not a full asset merger like the CVS-Aetna deal," the Walgreens-Prime relationship forms "a combined specialty and mail services company that launched in April. The two have said Alliance Rx Walgreen Prime (sic) will help millions of Blue Cross plan enrollees adhere to their medications and lead to improved health outcomes," Mr. Japsen wrote. Prime's BCBS parent plans cover more than 20 million members. CVS is expected to gain more than 22 million health plan members under its Aetna deal.
2. Mr. Japsen wrote the Walgreens-Prime partnership directs patients from CVS stores toward Walgreens pharmacies that are part of Prime's preferred pharmacy network. Walgreens CEO Stefano Pessina said during the Forbes Healthcare Summit a month ago in New York Walgreens' Prime deal has "saved substantial money for both of us."
3. Prime's preferred pharmacy network will also expand this year as Walgreens brings on 1,900-plus Rite Aid stores under its merger with the chain. Under an agreement that received regulatory approval in September 2017, Walgreens is buying 1,932 Rite Aid stores, three distribution centers and inventory for $4.38 billion. While Walgreens will shutter about 600 stores over an 18-month period beginning this year as part of the acquisition, Walgreens is expected to own more drugstores than CVS' 9,700 locations.
For the full Forbes article, click here.