Walgreens partners with Microsoft to develop digital healthcare services
We have another sign that transformation is underway at the pharmacy, which over the years has morphed from pharmacy only to a mix of pharmacy, personal care products, and convenience store. Yes, I’ve been known to pick up holiday decorations and even some pre-movie candy. There has been another set of pivots, including the launch of health clinics – when I was a kid there was no getting a flu shot at Walgreens Boots (WBA), CVS (CVS or Rite Aid (RAD) – which if we analyze it closely was part of strategy to combat rising healthcare costs and grab incremental revenue dollars, which are probably pretty tasty in terms of margins.
We are starting to see another pivot of sorts as pharmacy companies look to address the pain points associated with our Aging Population investing theme by embracing our Disruptive Innovators one as well. Interestingly, Walgreens is partnering with Microsoft (MSFT) to bring technology into the equation, including aspects of our Digital Lifestyle investing theme, to virtually connect people with Walgreens stores. As a result, Microsoft will win the corresponding cloud business, fending off Amazon (AMZN) and others.
Drugstore chain Walgreens Boots Alliance Inc and Microsoft Corp said on Tuesday they have entered a seven-year agreement to research and develop new methods of delivering healthcare services through digital devices.
As a part of the deal, the companies will focus on virtually connecting people with Walgreens stores and provide services on therapeutic areas ranging from preventative self-care to chronic disease management.
The drugstore chain said it will pilot up to 12 stores, which will sell select healthcare-related devices, in 2019.
Microsoft will become Walgreens’ cloud provider through the agreement and the Microsoft 365 software will be rolled out to more than 380,000 Walgreens employees and stores globally.
Source: Walgreens and Microsoft partner to develop digital healthcare services | Reuters
