Dive Brief:
- Walgreens has named former Cigna executive Tim Wentworth as its new chief executive officer, the retail pharmacy company announced late Tuesday.
- Wentworth is replacing Roz Brewer a little over a month after she announced her unexpected departure from Walgreens.
- Wentworth, who will become Walgreens CEO effective Oct. 23, is the former CEO of Express Scripts, the pharmacy benefit manager acquired by Cigna in 2018. At Cigna, he led health services business Evernorth.
Dive Insight:
In an interview with the Wall Street Journal, Wentworth said his experience in the healthcare industry and knowledge of the business needs of health companies like insurers would help him take the reins at Walgreens, a company that has struggled as it attempts to pivot to health services.
Wentworth has particular experience in pharmacy services. Before joining Express Scripts, one of the largest PBMs in the U.S., the longtime health executive led employer and key accounts at PBM Medco and was CEO of Accredo, Medco’s specialty pharmacy.
”The [Walgreens] board has been focused on bringing in a CEO with deep healthcare experience, and we are pleased to welcome Tim Wentworth as the company’s new CEO,” Walgreens Executive Chairman Stefano Pessina said in a statement. “We are confident he is the right person to lead [Walgreens’] next phase of growth into a customer-centric healthcare company.”
TD Cowen analyst Charles Rhyee said in a note that Wentworth’s experience aligns “very well” with Walgreens’ strategic direction, and that his experience makes him well-suited to manage Walgreens’ PBM and payer relationships.
Wentworth joins Walgreens during a pivotal change in the company’s strategic direction as it faces notable headwinds, like flagging COVID-19 test and vaccine revenue, staffing challenges in the pharmacy industry and reimbursement pressures from PBMs — including his former employer.
A number of Walgreens pharmacists walked off the job this week, protesting labor conditions and pay.
Walgreens laid off 10% of its corporate workforce in May, one month before posting third quarter earnings results that missed Wall Street expectations. Walgreens cut its 2023 outlook along with the results.
Walgreens — aiming to position itself more as a healthcare company than a pharmacy chain — has been investing heavily in its U.S. healthcare division.
The division, which includes value-based medical chain VillageMD, at-home care provider CareCentrix and specialty pharmacy Shields Health Solutions, situates Walgreens more firmly against rival CVS Health, which also acquired a value-based medical group this year.
Walgreens reports earnings Thursday morning.
