Domenic Pilla to rejoin McKesson Canada as chief executive

SAN FRANCISCO and TORONTO — McKesson Corp. has closed its $2.1 billion (U.S.) acquisition of Canadian drug chain Rexall Health and hired Domenic Pilla as chief executive officer of McKesson Canada.

Earlier this month, McKesson gained clearance from the Competition Bureau of Canada to finalize the Rexall Health acquisition, which was announced in early March.

Under the consent agreement with the bureau, McKesson must sell 26 Rexall drug stores in Alberta, British Columbia, Ontario, Saskatchewan and the Northwest Territories. Rexall Health currently operates approximately 470 Rexall/Pharma Plus drug stores in six provinces and one territory.

The addition of the Rexall/Pharma Plus stores makes McKesson Canada the largest drug store operator in Canada and the fourth-largest in North America. Besides the Rexall/Pharma Plus locations, McKesson Canada’s network includes about 1,700 independent pharmacies under various banners across Canada.

“Today’s announcement marks a milestone for McKesson and Rexall Health. With complementary assets, industry expertise and shared values, we will now serve our customers with enhanced retail pharmacy capabilities and a broader reach across Canada,” McKesson Corp. chairman and CEO John Hammergren said in a statement. “Patients across Canada will benefit from best-in-class pharmacy care through innovative care solutions and an expanded retail footprint. We are thankful to Daryl Katz, founder and chairman of Katz Group, one of Canada’s largest privately owned enterprises, for having built such a strong pharmacy asset in the Canadian market.”

McKesson said Pilla is slated to take the reins as McKesson Canada CEO on Jan. 3. In the role, he will oversee McKesson’s distribution and retail businesses in Canada, including Rexall Health, and report to Paul Julian, executive vice president and group president at McKesson Corp.

Current Rexall Health CEO Jürgen Schreiber is leaving the company to pursue other opportunities, McKesson said.

For Pilla, the appointment marks a return to McKesson Canada. He joined McKesson Canada in 2001 as executive vice president and became president in December 2006. In November 2011, he left the company to take the helm as CEO of Shoppers Drug Mart, filling the vacancy created by Schreiber, who had resigned in February of that year. Pilla left Shoppers Drug Mart at the end of 2014 following a management shakeup at Loblaw Cos.

“Domenic Pilla is uniquely qualified to lead our expanded portfolio in Canada based on his previous experience as president of Shoppers Drug Mart and McKesson Canada,” Julian stated. “He brings deep knowledge of both the wholesale and retail sides of the business and a proven track record of delivering results. We thank Jürgen Schreiber for his outstanding leadership in bringing this acquisition to fruition and wish him the greatest success.”

McKesson said Rexall Health will retain its brand and continue to have a dedicated management team overseen by Pilla, who will appoint a new Rexall Health president to provide day-to-day leadership for the chain. Also reporting to Pilla will be Paula Keays, who was named as president of McKesson Canada in late November.