Earlier this week, several media outlets reported that Walgreens is in negotiation discussions for a potential sale to private equity firm Sycamore Partners. With Walgreens’ debt and flagging in-store clinics, a major overhaul seems likely regardless. A few weeks ago, the retail pharmacy giant said it would be closing 1,200 locations over the next few years after reporting a $3 billion loss in the fourth quarter of 2024. A deal with Sycamore Partners would take the company private. Walgreens stock surged at the news of a potential acquisition.
Relationships matter: “It’s only been a couple of years since we saw significant investments by Walgreens and other retailers in on-demand and primary care as well as ancillary services like infusion, home health, and clinical trials,” says Alan Ayers, President of Urgent Care Consultants and Senior Editor of JUCM. “After shuttering previous in-store clinic models, Walgreens invested over $6 billion, adding over 200 VillageMD locations. Yet the company was slow to build its patient panels while labor-intensive operations burned cash, reinforcing to the investment community that primary care is a scale, volume-driven business and is more about the depth of connectivity and relationships with community providers than nationwide convenience.” Read more from the JUCM archive: “Big Retail” Pivots Are a Retreat from “On Demand” Care