Walgreen, Express Scripts sign new agreement
The Walgreen pharmacy chain will begin filling prescriptions from customers in the Express Scripts network again starting in September under a new multiyear contract that ends a costly impasse between the companies.
The agreement announced Thursday follows a series of disputes between Deerfield-based Walgreen and Express Scripts that ended with the discontinuation of the contract between the drugstore operator and the pharmacy benefit manager last year.
Since January, Walgreen has not filled prescriptions for Express Scripts, saying the company was not paying enough in drug dispensing fees. Its sales have slumped since the split.
Shares of Walgreen Co. jumped $3.55, or 11.5 percent, to $34.52 in morning trading Thursday while Express Scripts shares rose $1.09, or 1.9 percent, to $58.78.
Express Scripts Holding Co. said it ended the contract with Walgreen because the drugstore operator wanted a premium compared to what Express Scripts paid other pharmacies. Walgreen Co. had said it would rather give up the revenue than continue filling unprofitable prescriptions.
The companies said in a statement Thursday that Walgreen will rejoin the network of pharmacies available to Express Scripts customers starting Sept. 15. Terms of the new contract were not disclosed.
“We are in the business of providing a broad range of pharmacy, health and wellness services to help meet the needs of all of our customers,” said Greg Wasson, president and CEO of Walgreens, in a statement. “I am pleased that Walgreens and Express Scripts have been able to reach an agreement that works for both parties and is consistent with our company’s principles.
Before the companies’ contract lapsed, Express Scripts filed a lawsuit against Walgreen, accusing the drugstore chain of trying to lure away its customers. The lawsuit alleged that Walgreen told Express Scripts plan members, and especially Medicare Part D beneficiaries, that they would not be able to fill their prescriptions at Walgreen pharmacies unless they left Express Scripts and switched to a new pharmacy benefits management plan.
Express Scripts administers prescription drug benefits for health plan sponsors and members, and it pays drugstores like Walgreen to fill prescriptions.