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US pharmacy chain Walgreens buys 45% stake in Alliance Boots

By News team

Alliance Boots and the largest pharmacy chain in America, Walgreens, have announced a new business partnership, which they say will make them the biggest global leader in pharmacy and health and wellbeing retail.

The companies claim the partnership, which will allow Boots products to be sold in Walgreens stores and vice-versa, will make them the world’s largest purchaser of prescription drugs and other healthcare products (see Panel).

Ana Nicholls, healthcare analyst at the Economist Intelligence Unit, said: "While Walgreens is a market leader in the US, Alliance Boots is already Europe's biggest pharmaceutical wholesaler. Together they will create the world's biggest pharmacy wholesaler, which gives them obvious cost advantages and clout in negotiations with healthcare payers, as well as in consumer markets."

A spokeswoman for both Boots and Walgreens said the partnership will have a positive impact on pharmacies in the UK. "They can offer an expanded range of products and services, and Boots will have access to the US market [while] Walgreens will gain access to the European and Asian markets," she told PJ Online.

Alex Gourlay, head of health and beauty at Alliance Boots said the deal will allow the sharing of best pharmacy practice between the UK and the US and create a more efficient wholesaler distribution service.

He told PJ Online: "At the core of the partnership is pharmacy. It is about creating this global pharmacy led health and wellbeing enterprise."

The partnership

Walgreens will invest approximately $6.7bn in cash and stock in exchange for a 45% equity ownership stake in Alliance Boots, an investment that is expected to be completed by 1 September 2012.

Walgreens will have the option to acquire the remaining 55% of Alliance Boots in approximately three years’ time.

Between them, the two organisations have a wholesale network of more than 370 distribution centres, delivering to more than 170,000 pharmacies, doctors, health centres and hospitals in 21 countries.

 

Citation: The Pharmaceutical Journal URI: 11103156

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