Walgreens Boots Alliance's plunge into the health care field is already starting to lose buoyancy.
The Deerfield, Ill.-based retailer pulled off a string of strategic moves in the health care sector over the last couple of years, one of which was buying a major stake in VillageMD for $5.2 billion in 2021. Now, Business Insider is reporting that Walgreens will be closing all remaining VillageMD clinics in the state of Florida.
The Florida closings began in December 2023 when Walgreens announced 10 VillageMD clinics in Jacksonville, Fla., would be powered down.
According to Walgreens, moving out of the state will allow it to zero in on areas with more market power.
It’s all part of an overall plan to cut $1 billion in operating costs laid out by new CEO Tim Wentworth. During a January earnings call, Wentworth said the company was almost halfway through planned closures that included 60 VillageMD clinics and also 450 stores. Wentworth also said the company was evaluating all strategic options to shore up costs and increase cash flow.
In addition, Walgreens might be shopping around specialty pharmacy Shields Health Solutions and recently replaced U.S. Healthcare President John Driscoll with Mary Langowski.
The pharmacy retailer also lost Chief Human Resources Officer Holly May, Chief Medical Officer Kevin Ban, Chief of Staff to the CEO Luke Sauter along with its CFO, CIO, and chief marketing officer.
The wave of departures followed an announcement that the retailer was going to cut corporate bonuses amid financial weakness.
The company has also laid off hundreds of executives at the Deerfield headquarters to trim costs.
Opioid settlements, other lawsuits, and a post-COVID world that has shrunk revenue for pharmacies have left Walgreens searching for financial solutions.
In January, Walgreens agreed to pay $360 million to health care insurance company Humana to settle a lawsuit alleging the retail giant overcharged for prescription drug reimbursements.
On Monday, Amazon replaced Walgreens Boots Alliance on the Dow Jones Industrial Average.
Walgreens did not respond to a request for comment in time for publication.
