Walgreen Cuts Ties With CVS Caremarks Pharmacy Benefit Manager
Walgreen Co. announced Monday, June 7, that it won’t participate as a provider in any new or renewed prescription drug plans to rival CVS Caremark Corp.’s pharmacy benefit manager.
Deerfield, Illinois-based Walgreen, which has more than 7,500 stores, said it concluded that the partnership wasn’t in the best interest of its customers, pharmacists and shareholders.
“It’s a good calculated risk” on Walgreen’s part, said Gregory Madsen, principal at Deerfield-based health care benefits consultancy Innovative Rx Strategies. “Employers in general don’t want to lose Walgreen in their network.”
CVS Caremark is the largest distributor of prescription drugs in the United States. Existing CVS Caremark plans that include Walgreen won’t be affected until renewal time.
In a letter to CVS Caremark addressing the decision, Walgreen pointed out several issues within the partnership. They include the unpredictability of reimbursement rates and “no or little information” received when a CVS Caremark drug plan is transferred.
“Unfortunately, as a result of CVS Caremark’s pharmacy benefit management practices toward Walgreen, it no longer makes good business sense for Walgreen to be part of their network for new and renewed plans,” president and CEO Greg Wasson said in the statement.
Officials at Rhode Island-based CVS weren’t immediately available for comment.