Kroger pharmacies get back together with Express ScriptsKroger pharmacies get back together with Express Scripts

Kroger Co. said on Wednesday that it has entered a new agreement with pharmacy benefits management company Express Scripts, enabling Express Scripts customers to fill their prescriptions and obtain other health services at Kroger pharmacies. Kroger had exited a previous agreement with Express Scripts in 2022, citing proposed terms that would have been unprofitable for the retailer.

Biggest news for grocery?

Express Scripts, which is owned by the Evernorth division of insurance giant The Cigna Group, is one of the “big three” pharmacy benefit managers (PBMs) that control prescription drug pricing and coverage, along with CVS Caremark and OptumRx. These PBMs and others have come under increasing scrutiny by legislators of both parties as retail pharmacy operators have blamed PBMs for squeezing their profits and for their lack of transparency.

In January, Express Scripts said it was implementing several changes to reduce out-of-pocket drug costs for customers and to make its pricing practices more transparent.

The new agreement with Express Scripts could be a big boost for Kroger’s pharmacy business, which the company said took a hit when it ended the previous Express Scripts agreement. In its most recent quarter, Kroger credited its pharmacy operations as a significant driver of sales growth, citing vaccine administration in particular.

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More detail

Under the new agreement, the Kroger pharmacies will immediately resume serving customers who are part of Express Scripts’ Medicare Part D plans and Tricare/Department of Defense plans, Kroger said in a statement. Additionally, Express Scripts commercial and Medicaid clients can add Kroger pharmacies to their respective networks.

It was not immediately clear what had changed that led Kroger and Express Scripts to work together again. Kroger declined to comment further on the new agreement.

By the numbers

• Collectively, the insurance and government-sponsored plans that are impacted by this new agreement cover more than 100 million people in the U.S., Kroger said.

• Kroger said in 2023 that the loss of the Express Scripts business reduced its identical-store sales by about 150 basis points.

• At the end of its last fiscal year, Kroger operated 2,257 pharmacies in its 2,722 supermarkets. It also operates about 225 The Little Clinics inside its stores.

In their own words

“At Kroger Health, we believe everyone should have access to comprehensive healthcare. We look forward to again serving Express Scripts customers. This agreement reaffirms our commitment to bringing high-quality services to more customers across the country.” — Colleen Lindholz, president, Kroger Health

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