Walgreen Company (WAG), CVS Caremark Corporation (CVS): Why Your Next Doctor’s Visit May Be a Trip to the Pharmacy

With chronic care accounting for about three-quarters of health care spending, Walgreen Company (NYSE:WAG)’s push into this niche market should be a profit driver for the company down the road. It may even help Walgreen recover some of the customers it lost last year after the fallout with pharmacy benefits manager  Express Scripts Holding Company (NASDAQ:ESRX).

Express Scripts Holding Company (NASDAQ:ESRX), which provides a variety of pharmacy services including patient care and benefit management care, contributed about $5 billion in annual sales for Walgreen. However, when Walgreen dropped its contract with Express Scripts Holding Company (NASDAQ:ESRX), it saw that revenue disappear along with tens of thousands of customers in the Express Scripts network. Fortunately, Walgreen Company (NYSE:WAG) settled the dispute with Express Scripts last year and inked a new multiyear deal with the company. Still, it’s been a slow climb for Walgreen as the pharmacy chain attempts to win back lost customers.

Moreover, by expanding the scope of services offered in its Take Care Clinics, Walgreen could see some of these lost customers return to its pharmacies. Going forward, Walgreen Company (NYSE:WAG)’s investment in its in-store clinics should start to pay off as more people ditch the doctor’s office for convenient care.

The article Why Your Next Doctor’s Visit May Be a Trip to the Pharmacy originally appeared on Fool.com and is written by Tamara Rutter.

Fool contributor Tamara Rutter has no position in any stocks mentioned. The Motley Fool recommends Express Scripts. The Motley Fool owns shares of Express Scripts.

Copyright © 1995 – 2013 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.