Walgreens And Blue Cross-Owned PBM Launch New Company
Walgreens Boots Alliance has officially launched its new specialty pharmacy and prescription mail services company with pharmacy benefit manager Prime Therapeutics , a PBM owned by 14 Blue Cross and Blue Shield plans.
The new company, AllianceRx Walgreens Prime, begins immediately, executives said Monday, having already negotiated a new retail pharmacy network that began earlier this year between Prime and Walgreens.
The new firm establishes much closer ties between Walgreens and the nation’s fourth-largest PBM at a time health plans and employers are trying to gain leverage against the pharmaceutical industry and its development of new, more expensive drugs. PBMs negotiate deals on behalf of employers or government health programs like Medicare and Medicaid, helping their clients better coordinate care and manage drug costs through buying drugs in bulk and essentially negotiating better–at times exclusive–deals for lower medicine prices.
AllianceRx Walgreens Prime will compete with PBM giants that include Express Scripts ESRX +0.03%, UnitedHealth Group UNH +0.94%’s Optum Rx and CVS Health CVS -0.51%’s Caremark PBM subsidiary. AllianceRx Walgreens Prime, which is based in Orlando, manages "several consolidated mail service and central specialty pharmacy operations" and have 3,000 employees across the country.
“Leveraging Walgreens' pharmacy network and operational efficiencies, along with the pharmacy benefit management expertise of Prime, we have the resources to deliver better care coordination, patient outcomes and exceptional care and service to patients and payers,” Joel Wright, a longtime Walgreens executive who will lead AllianceRX Walgreens Prime as chief executive officer, said in a statement.
The closing of the deal with Prime follows through on a commitment by Walgreens CEO Stefano Pessina to seek a “strong commercial agreement” with a PBM. Should Walgreens eventually complete its acquisition of Rite Aid RAD -0.82%, it will inherit a small PBM, EnvisionRx, but Prime’s relationships are much broader.
Prime Therapeutics was formed almost 30 years and has gradually grown to include some of the nation's largest Blue Cross and Blue Shield companies, including Health Care Service Corp., which owns Blue Cross plans in Illinois, Texas, Oklahoma, New Mexico and Montana.
"Already, the retail pharmacy network agreement component of our alliance is yielding considerable savings for our plans and their members, as fully 50% of Prime's members have transitioned into a network anchored by Walgreens,” Prime President and CEO Jim DuCharme said in a statement.