Originally published June 19 2005
Walgreens pumps profits into expanding health services division
by Mike Adams, the Health Ranger, NaturalNews Editor
Walgreens is planning to quadruple the size of its Walgreens Health Services, according to the Chicago Sun-Times, to compete with increasingly popular mail-order prescriptions and other health services that provide drug plans for private companies.
Walgreen Co. is quadrupling the size of its business that operates largely unseen, outside of its stores, to better compete with the threat of increasingly popular mail-order prescriptions.
The business, called Walgreens Health Services, gets most of its $1.4 billion in yearly revenue from Walgreen's own mail-order prescription sales.
The business also includes Walgreen's pharmacy benefit-management service, called Walgreens Health Initiatives, which competes with companies such as Medco Health Solutions Inc. and AdvancePCS to provide drug plans for private companies.
Smaller pieces of the business are specialty pharmacy and a home-care division that provides services from medical equipment to intravenous infusions.
If the Deerfield-based drugstore company succeeds in quadrupling the out-of-store business, it could grow to more than $5 billion in five years, and add 1 to 2 percentage points to Walgreen's revenue growth rate in the same period, according to a research report by Mark Miller of William Blair & Co. in Chicago.
Tuesday at Navy Pier's Lakeview Terrace to provide information about jobs in its Health Services division ranging from pharmacy technicians to account managers to computer programmers.
A Walgreen spokesman declined to specify how many people the company intends to hire.
The overall health services division has grown to represent about 3.5 percent of Walgreen's total revenues, up from 1.9 percent 10 years ago.
More recently, Walgreens Health Initiatives has won a partnership with Ovations, a division of UnitedHealth Group, to be the exclusive provider of prescription drugs and mail-order pharmacy services under the new Medicare prescription drug benefit.
The new Medicare prescription-drug coverage starts Jan. 1.
The partnership could boost the membership of Walgreens Health Initiatives to 6 million or 7 million from today's 4 million, according to analyst Miller's research.
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