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Walgreens total sales, comps dip in May

BY Allison Cerra

DEERFIELD, Ill. — Walgreens on Tuesday posted May sales of nearly $6 billion, a decrease of 1.6% as compared with the same month in fiscal year 2011.

The negative impact on comparable-store prescriptions filled due to no longer being part of the Express Scripts pharmacy network was 10.8 percentage points. Prescriptions processed by Express Scripts comprised 12.7% of Walgreens prescriptions in May 2011. May pharmacy sales decreased 3.9%, while comparable-store pharmacy sales decreased 8.5%. Comparable-store pharmacy sales were negatively impacted by 3.9 percentage points due to generic drug introductions in the last 12 months and by 0.3 percentage points due to the product mix of cough, cold and flu drugs.

Pharmacy sales accounted for 63.1% of total sales for the month.

Prescriptions filled at comparable stores decreased 7.6% in May. Calendar day shifts in May, which had one additional Wednesday and Thursday, and one fewer Sunday and Monday, compared with May 2011, positively impacted prescriptions filled in comparable stores by 1.3 percentage points.

Walgreens’ May sales announcement follows a statement from the drug store chain that its dispute with pharmacy benefit manager Express Scripts had been mutually dropped, and that Walgreens would be extending its partnership with OptumRx, one of the largest pharmacy benefit managers in the United States.

"Since Jan. 1, our underlying trend for number of prescriptions filled has improved," Walgreens EVP and CFO Wade Miquelon said. "Looking forward, we expect our number of prescriptions filled to be helped as employers and health plans take a variety of steps ranging from changing prescription benefit managers to changing language in new RFPs to provide continued access to Walgreens and our services. In what is the busiest selling season in recent memory, we are pleased that we have continued to receive notification of pharmacy plans regaining access to Walgreens pharmacies with new contracts that become effective throughout the remainder of the year. In addition, we extended our multi-year agreement to build on our strategic partnership with OptumRx, one of the largest pharmacy benefit managers in the United States."

Walgreens did see a small positive gain in total front-end sales, which increased 0.3%, compared with the same month in 2011; however, comparable-store front-end sales decreased 1%. Customer traffic in comparable stores decreased 2.3% while basket size increased 1.3%.

Sales in comparable stores decreased by 5.8%. The effect of calendar day shifts positively impacted total comparable sales by 0.8 percentage points. Last week, Credit Suisse analyst Ed Kelly projected that Walgreens would experience a 5% to 6% drop in comps, saying "the weak May results close out what should be a disappointing top-line quarter for the company," adding that "the loss of [Express Scripts] traffic and recent adjustments to the circular are impacting front-end sales."

Calendar year-to-date sales were $29.4 billion, a decrease of 2.2% from nearly $30.1 billion in 2011.

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SoloHealth receives FDA approval for SoloHealth Station

BY Allison Cerra

ATLANTA — An interactive health-and-wellness screening kiosk for consumers has received regulatory approval from the Food and Drug Administration.

SoloHealth said its SoloHealth Station, which currently is installed in select U.S. test markets and retail locations, has received FDA clearance. The SoloHealth Station provides health screenings for vision, blood pressure, weight and body mass index, a symptom checker, as well as an overall health assessment free of charge. SoloHealth also helps connect consumers to local professionals through their databases, helping people enter the most appropriate and accurate point in the healthcare system. The kiosk recently was honored with Intel’s IT healthcare award (the "Intel Innovation Award") that recognizes leading-edge technology and exceptional innovation for healthcare delivery and processes.

"We hold accuracy, reliability, and safety standards at the highest level and are pleased to have met and exceeded regulatory standards with the testing trials we have conducted nationwide," SoloHealth COO Stephen Kendig said. "With the FDA clearance, we can now aggressively begin our nationwide rollout of the SoloHealth Station, providing consumers free access to their health data in convenient retail locations across the U.S. We believe our SoloHealth Station will help educate and empower millions of Americans to take charge of their own health and should ultimately lead to a healthier, more efficient, and more financially sound nationwide healthcare system."

SoloHealth said it expects roll out additional kiosks to retail pharmacy locations nationwide by end of the year and is slated to announce partnerships with retailers and strategic alliances within the next one to two months.


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Family Dollar rolls out Redbox kiosks to stores nationwide

BY Allison Cerra

MATTHEWS, N.C. — Family Dollar is getting the Redbox treatment.

The discount store chain announced it inked a multiyear deal with the Coinstar subsidiary, through which Redbox kiosks will be installed at Family Dollar locations across the United States. Family Dollar customers will be able to rent new release DVDs at Redbox for $1.20 a night, Blu-ray discs for $2 a night and games for $2 a night.

"As Family Dollar continues to broaden its assortment and increase relevancy to our customer, Redbox is a natural addition to our growth initiatives," Family Dollar president and COO Mike Bloom said. "The Redbox kiosk is the definition of convenience for movie and game rentals and will provide value, convenience and additional reasons for customers to visit Family Dollar stores more often."

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