Walgreens, CVS Health tick lower after Amazon - One Medical deal
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Pharmacy chain operators Walgreens Boots Alliance (NASDAQ:WBA) and CVS Health Corporation (CVS) dropped Wednesday after tech giant Amazon (AMZN) intensified the primary care rivalry with an agreement to acquire One Medical (ONEM).
The shares of One Medical (ONEM) surged ~69% after the pre-market announcement of the all-cash deal indicated ~$3.9B value for the San Francisco, California-based operator of the One Medical membership-based primary care platform.
Meanwhile, the shares of Walgreens (WBA) and CVS Health (CVS), both of which are increasing their footprint in primary care, are on the decline. Walgreens (WBA) is in the red for the first time in four sessions, while CVC Health (CVS) has extended losses for the second straight session.
After acquiring the primary care provider Village Practice Management in November, Walgreens (WBA) is on track to open 200 VillageMD clinics by the end of 2022, the management said in June. VillageMD operated 315 clinics at the end of 3Q fiscal 2022, an increase of 97 units from a year ago.
In December, CVS Health (CVS) announced its foray into primary care with plans to add traditional drugstore services and employees such as dietitians in the companyâs drugstore and âHealthHUBâ locations.
ââ¦..we are continuing to look for a broader range of primary care capabilities. Itâs an interesting market,â Chief Executive Karen Lynch noted during the recent earnings call. âWe are trying to make sure that we are prudent, both strategically and financially, but it is part of our strategy,â she added, highlighting the importance of the market.
CVS Health (CVS) had approached 1Life Healthcare (ONEM) for a buyout deal, but the talks with the company ended amid interest from other bidders, Bloomberg reported in June.