Walgreens Boots Alliance Inc. and Microsoft Corp. entered into a seven-year agreement that will see the two companies leverage their assets and technology to create platforms aimed at improving health outcomes and lowering the cost of care across the globe.
The deal seeks to leverage Microsoft Azure, the tech giant's cloud and artificial intelligence platform, healthcare investments and new retail solutions with Walgreens' customer reach, convenient locations and outpatient healthcare service, according to a Jan. 15 news release. The two companies aim to develop innovative platforms that enable next-generation health networks, integrated digital-physical experiences and care management solutions.
The companies will work with consumers, providers and organizations in the supply chain, which includes Walgreens and Boots pharmacists, in order to establish a seamless ecosystem that will enable them to identify the right partners to develop solutions and bring it down to the consumer level. Microsoft and Walgreens will focus on connecting Walgreens stores and health information systems to people wherever they are through their digital devices, thus giving them access to healthcare services tailored to their needs.
The two companies said they have also committed to a multiyear research and development investment that will include funding, subject-matter experts, technology and tools. To that end, they plan to explore establishing joint innovation centers in key markets, the release said.
Walgreens is scheduled to pilot up to 12 store-in-store "digital health corners" in 2019 aimed at the merchandising and sale of select healthcare-related hardware and devices, the release said.
Microsoft recently signed a deal with grocery operator The Kroger Co. to pilot connected stores powered by the tech giant's Azure cloud platform. Meanwhile, December 2018 saw Kroger and Walgreens expand their collaborative pilot, which allows users to pick up and buy Kroger orders and products at select Walgreens locations.
In October 2018, Fitch Ratings affirmed Illinois-based pharmacy chain Walgreens' ratings based on its strong position in the drugstore industry and bullish prospect in the U.S. pharmaceutical and general merchandise sector. But the rating agency also noted that Amazon.com Inc. may prove an emerging threat given its acquisition of mail-order pharmacy company PillPack Inc. Amazon's purchase of Whole Foods Market Inc. shows that it could be an increasing threat for share gain in some of Walgreens' categories, such as food consumables, the rating agency said.