Creating 'neighborhood health care destinations'

DEERFIELD, Ill.  – Walgreens Boots Alliance (WBA) is partnering with VillageMD to roll out full-service doctors offices in its stores, the companies said Wednesday.

The move follows a successful trial begun last year.

The plan calls for the opening of 500 to 700 “Village Medical at Walgreens” physician-led primary care clinics in more than 30 U.S. markets in the next five years, followed by the opening of hundreds more thereafter.

The clinics will integrate the pharmacist as a critical member of VillageMD’s multi-disciplinary team to deliver the very best health care to patients, and will be staffed by more than 3,600 primary care providers, who will be recruited by VillageMD.

The clinics will accept a wide range of health insurance options, and offer comprehensive primary care across a broad range of physician services. Additionally, 24/7 care will be available via telehealth and at-home visits. More than 50% will be located in health professional shortage areas and medically underserved areas/populations, as designated by the U.S. Department of Health and Human Services.

This rollout follows a trial with five in-store clinics in the Houston, Texas area, which produced very strong results after opening last November including high patient satisfaction, with Net Promoter Scores over 90.

Data from current Village Medical clinics shows that an integrated pharmacy and primary care approach increases medication adherence and contributes to improved patient outcomes.

“This rollout is a major advancement of one of Walgreens Boots Alliance’s four key strategic priorities, Creating Neighborhood Health Destinations,” said Stefano Pessina, executive vice chairman and CEO of Walgreens Boots Alliance. “These clinics at our conveniently located stores are a significant step forward in creating the pharmacy of the future, meeting many essential health needs all under one roof as well as through other channels.”

“In the U.S., we spend $4 trillion per year on health care, over 85 percent of that is tied to patients with chronic diseases. To improve our healthcare system and reverse the trajectory of health spending, we must meet the needs of all patients. This partnership allows us to unleash the power of primary care doctors and pharmacists, enabling them to work in a coordinated way to enhance the patient experience,” said Tim Barry, chairman and CEO of VillageMD. “The results of our initial pilot clinics highlight that these outcomes are infinitely achievable.”

Most of the clinics will be approximately 3,330 square feet each, with some as large as 9,000 square feet. They will optimize existing space in the store, which will also still provide a vast range of retail products to customers.

VillageMD and Walgreens also recently announced the availability of Village Medical telehealth providers on Walgreens Find Care, which is an online platform that connects patients with a wide range of health services.

Under the terms of the new agreement, WBA will invest $1 billion in equity and convertible debt in VillageMD over the next three years, including a $250 million equity investment to be completed today.

Of WBA’s investment, 80% will be used by VillageMD to fund the opening of the clinics and build the partnership, including integration with Walgreens digital assets.

It is anticipated, assuming full conversion of the debt, that WBA will hold an approximately 30% ownership interest in VillageMD at the completion of the investment.