Walgreens has announced that it is to extend its agreement with CVS Caremark.
New agreement will have positive benefits
The agreement between Walgreens and CVS Caremark will see Walgreens remain as a network pharmacy provider within the CVS Caremark pharmacy benefit management (PBM) retail network. This should drive more customer traffic to Walgreens retail pharmacies, which has showed little or no improvement over the last few months.
Whilst no financial details of the agreement have been made public, this move by Walgreens is in line with its current strategy.
Walgreens also has a multi-year agreement with Express Scripts, which was renewed in September 2012 following a disagreement earlier in the year. As a result of the fall out with Express, the main beneficiary appears to have been CVS.
The challenge for CVS is to retain all those Express clients who made the switch to CVS, following the disagreement between Express and Walgreens, who are now working hard to encourage the same clients back to their stores.