Pharmacy store-chain Walgreens Boots Alliance and health insurer Humana are holding early discussions to take stakes in each other’s businesses, according to a report from The Wall Street Journal.
Sources familiar with the matter told the Journal that the pair of companies are holding discussions about a number of possibilities for a partnership, including expanding their existing tie-up that caters to older Americans.
There is no guarantee a deal will finalize. Spokespersons for Walgreens and Humana did not return FOX Business’ request for comment.
Meanwhile, mergers are becoming more common in the health care industry as businesses adapt to an evolving health care landscape.
The largest U.S. retail pharmacy CVS recently won clearance from the Department of Justice to move forward with its planned $69 billion acquisition of health insurance giant Aetna. Experts believe the acquisition of Aetna would give CVS better leverage in pricing discussions, which would be particularly valuable at a time when companies are inundated with public pressure to reduce costs. It could also usher more patients into its MinuteClinics for care.
According to the Journal, a potential deal between Humana and Walgreen’s could bring the latter the same benefits as CVS is expected to receive from its mega-merger, at a much smaller cost.
The DOJ also recently gave the green light for health insurer Cigna to acquire pharmacy benefits manager Express Scripts.
Walgreens employs more than 240,000 people and has more than 85,000 health care service providers. In fiscal 2018, the pharmacy chain filled 1.1 billion prescriptions. Nearly 80 percent of the U.S. population lives within five miles of a Walgreens Boots Alliance-owned store, which also includes Duane Reade and Rite Aid.
Humana, which covers about 21 million U.S. members, is also the second largest provider of Medicare Advantage plans.