Looking for a great deal?
Get ALL THREE of our new thank-you gifts when you donate $120.
This is a limited time offer – so act soon!
Chicago-based pharmacy giant Walgreens is getting bigger, announcing a deal to buy competitor Rite Aid for more than $9 billion.
The deal comes just a few months after CVS acquired Target’s pharmacy business. Late last year, Walgreens merged with the European drug chain Alliance Boots.
“Folks are all competing to get a bigger share of the newly insured from the Affordable Care Act,” said Brian Owens, director of drug channel research at Kantar Retail. “So, there’s more competition for low-cost prescription drugs.”
To compete on cost, pharmacy chains are consolidating, said analyst John Boylan of Edward Jones.
“A bigger company can get bigger discounts from people that they purchase from,” he said. It can also negotiate better deals for prescription reimbursements.
The merger between Walgreens and Rite Aid is likely to get close scrutiny from federal regulators, who want to maintain competition in the marketplace. Walgreens may have to sell some stores in certain markets, said Owens.
Meanwhile, Wal-Mart might be the next big chain to consider acquisitions, he said.
“We know that Wal-Mart wants to be the No. 1 health care provider in the United States.”
If you’re a member of your local public radio station, we thank you — because your support helps those stations keep programs like Marketplace on the air. But for Marketplace to continue to grow, we need additional investment from those who care most about what we do: superfans like you.
Your donation — as little as $5 — helps us create more content that matters to you and your community, and to reach more people where they are – whether that’s radio, podcasts or online.
When you contribute directly to Marketplace, you become a partner in that mission: someone who understands that when we all get smarter, everybody wins.