Walgreens Boots Alliance (WBA) said it would partner with pharmacy benefit manager Prime Therapeutics to reduce drug procurement costs.
The companies will combine their central specialty pharmacy and mail order service businesses and introduce a new retail pharmacy network that will give Prime Therapeutics’ customers access to Walgreens’ pharmacy network.
Specialty pharmacies provide drugs to people with expensive chronic conditions such as rheumatoid arthritis. Walgreens has four central specialty pharmacies that mainly provide mail order services.
Pharmacy benefit managers (PBMs) administer drug benefits for employers and health plans, helping them get better prices from drugmakers.
The combined entity will be owned by Walgreens and Prime Therapeutics, but will have a separate board and executive team, which will be announced later this year.
Walgreens, the largest U.S. drugstore operator by store count, already has partnerships with PBMs such as Express Scripts Holding (ESRX)and UnitedHealth Group (UNH)‘s OptumRx.
Walgreens is also in talks to acquire Rite Aid (RAD), which will give it ownership of Rite Aid’s PBM, EnvisionRx.
Prime Therapeutics, the fourth-largest U.S. PBM, is owned by 14 leading Blue Cross and Blue Shield health plans.