– Walgreens will invest $1 billion in equity and convertible debt in VillageMD to open 500 physician-led primary care clinics in more than 30 U.S. markets in the next five years.
– VillageMD and Walgreens also recently announced the availability of Village Medical telehealth providers on Walgreens Find Care™, which is an online platform that connects patients with a wide range of health services.
Walgreens Boots Alliance, Inc. and VillageMD announced today that Walgreens will be the first national pharmacy chain to offer full-service doctor offices co-located at its stores at a large scale, following a highly successful trial begun last year. This expanded partnership will open 500 to 700 “Village Medical at Walgreens” physician-led primary care clinics in more than 30 U.S. markets in the next five years, with the intent to build hundreds more thereafter.
Here are five things to know about the landmark deal:
1. The clinics will accept a wide range of health insurance options and offer comprehensive primary care across a broad range of physician services. Additionally, 24/7 care will be available via telehealth and at-home visits. More than 50 percent will be located in Health Professional Shortage Areas and Medically Underserved Areas/Populations, as designated by the U.S. Department of Health and Human Services.
2. This rollout follows a trial with five in-store clinics in the Houston, Texas area, which produced very strong results after opening last November including high patient satisfaction, with Net Promoter Scores over 90.
3. Most of the full-service clinics will be approximately 3,330 square feet each, with some as large as 9,000 square feet. They will optimize existing space in the store, which will also still provide a vast range of retail products to customers.
4. Under the terms of the new agreement, WBA will invest $1B in equity and convertible debt in VillageMD over the next three years, including a $250M equity investment to be completed today.
5. Of WBA’s investment, 80 percent will be used by VillageMD to fund the opening of the clinics and build the partnership, including integration with Walgreens digital assets. WBA will hold an approximately 30 percent ownership interest in VillageMD at the completion of the investment.
“In the U.S., we spend $4 trillion per year on healthcare, over 85 percent of that is tied to patients with chronic diseases. To improve our healthcare system and reverse the trajectory of health spending, we must meet the needs of all patients. This partnership allows us to unleash the power of primary care doctors and pharmacists, enabling them to work in a coordinated way to enhance the patient experience,” said Tim Barry, chairman and CEO, VillageMD. “The results of our initial pilot clinics highlight that these outcomes are infinitely achievable.”
