Over 250,000 Tricare Beneficiaries, Supporters Petition Express Scripts on Behalf of Walgreens

WASHINGTON, December 08, 2011 - More than a quarter of a million U.S. military personnel, family members, retirees and others in the Department of Defense Tricare pharmacy benefits program, and their supporters, so far have signed petitions demanding access to Walgreens (NYSE: WAG)(NASDAQ: WAG) pharmacies under the Tricare pharmacy program. The pace of petition signatures from Tricare members seeking to retain access to Walgreens and their supporters has reached more than 10,000 per week in recent weeks.

Walgreens said the refusal by Express Scripts, Inc. (NASDAQ: ESRX), the pharmacy benefit manager for Tricare, to separate the Tricare business from its other business disputes with Walgreens suggests a willingness to sacrifice the needs of Tricare beneficiaries, an action especially surprising in light of the outpouring of support from U.S. military families for continued access to Walgreen pharmacies.

Meanwhile, Walgreens has repeatedly offered to remain in the Tricare pharmacy network through proposals to Express Scripts that are designed to prevent disruption to military personnel, families and retirees. These proposals would protect Tricare member choice of Walgreens and provide savings to the program and taxpayers. Specifically, Walgreens has:

  • Offered to negotiate the Tricare renewal separately from Express Scripts’ commercial business in order to continue to provide Walgreens services on an uninterrupted basis to all active and retired military personnel.
  • Offered to lower Tricare reimbursement rates across the board resulting in double-digit million dollar savings to the U.S. military and taxpayers over the next few years.
  • Provided an ironclad guarantee that Walgreens prices would match or beat the average costs per adjusted prescription of all other retail pharmacies in the Tricare network. Those costs would be compared on an apples-to-apples basis and verified by an objective third party each quarter. Walgreens also committed to reimbursing Tricare for any overage following the end of each quarterly review.

“The last thing military personnel, families and retirees need is for their pharmacy benefits and choices to be disrupted by this issue,” said Kermit Crawford, Walgreens president of pharmacy, health and wellness solutions and services. “Walgreens proposals to protect Tricare members remain on the table. There is no reason the parties cannot act quickly – before the Dec. 31 deadline – to protect Tricare members from disruption, and Walgreens is prepared to do so.”

Express Scripts’ rejection of Walgreens offers means that Tricare’s nearly 6 million beneficiaries will no longer have in-network insurance coverage for prescriptions they fill at Walgreens and Duane Reade pharmacies starting on Jan. 1, 2012.

“During Walgreens 100-plus years of serving the pharmacy needs of America’s military personnel, families and retirees, we have developed a trusted relationship that Tricare beneficiaries value and depend on,” said Crawford. “We urge Express Scripts to heed the call of more than 250,000 Tricare members and their supporters so far, to prevent disruption of Tricare members’ relationship with our community pharmacists and put the needs of military communities ahead of this business matter.”

Walgreens also pledged that if Express Scripts continues to reject these offers, the company will work with Tricare beneficiaries in an effort to make any transition after Dec. 31, 2011, as seamless as possible.

About Walgreens:

Walgreens (www.walgreens.com) is the nation's largest drugstore chain with fiscal 2011 sales of $72 billion. The company operates 7,786 drugstores in all 50 states, the District of Columbia and Puerto Rico. Each day, Walgreens provides nearly 6 million customers the most convenient, multichannel access to consumer goods and services and trusted, cost-effective pharmacy, health and wellness services and advice in communities across America. Walgreens scope of pharmacy services includes retail, specialty, infusion, medical facility and mail service, along with respiratory services. These services improve health outcomes and lower costs for payers including employers, managed care organizations, health systems, pharmacy benefit managers and the public sector. Take Care Health Systems is a Walgreens subsidiary that is the largest and most comprehensive manager of worksite health and wellness centers and in-store convenient care clinics, with more than 700 locations throughout the country.

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Michael Polzin, (847) 315-2920


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