First Prev
of 2
Next Last
fallofwag

Euless, TX

#1 Jun 21, 2012
CtW Investment Group: Walgreens Needs an Independent Review of Express Scripts Dispute

WASHINGTON, Jun 19, 2012 (BUSINESS WIRE)-- The CtW Investment Group is releasing a letter to Walgreens WAG -2.92% Chairman Alan McNally today calling for an independent review of the Express Scripts dispute. The Investment Group believes this review is necessary to determine if remaining outside of the ESRX pharmacy network is in the best interest of shareholders. The group is also asking Walgreens to establish clear performance benchmarks for the second half of the calendar year.

Excerpts of the letter to Walgreens Chairman Alan McNally from CtW Investment Group Executive Director William Patterson are below:

"Walgreens shareholders have seen our company lose one third of its market value, more than $14 billion, since the company announced it would exit the pharmacy network of Express Scripts (ESRX), the largest pharmacy benefit manager in the country, about a year ago. Shareholders bear the costs of this disastrous decision, as the percentage of scripts lost due to the dispute continues to rise, belying management's optimistic statements about recapturing ESRX business. Given ongoing damage to our company we believe the time has come for the Board to establish a special committee comprised of independent directors to review the Express Scripts dispute and set clear benchmarks for performance in the second half of the calendar year.

***

"Walgreens has a track record of aggressive bargaining with PBMs and state governments, which served the company well in the past. But with this latest maneuver, management made a gross miscalculation that has decimated shareholder value and placed the company at loggerheads with industry trends towards limited pharmacy networks.

***

"The market's faith in Walgreens management has been seriously shaken and we believe that the time is now for the Board to demonstrate responsible leadership and right the course of the company. If Walgreens insists on maintaining its lone stand against Express Scripts there must be clear measures of performance reported to shareholders that demonstrate whether the company can successfully grow its pharmacy business without the nation's largest PBM."

The CtW Investment Group works with pension and benefit funds sponsored by unions affiliated with Change to Win, which collectively hold over $200 billion in assets.

Since: Jan 12

United States

#2 Jun 21, 2012
Ooooooh! I like it!

Since: Feb 12

United States

#3 Jun 21, 2012
Yep, except for the part were we lost 1/3 of our market value, classic overreaction of bad news driving down a stocks price lower than necessary. ESI didn't account for anywhere near that amount in revenue, much less profit for WAG. PLUS these shareholders are the ones that Wasson and company are trying to appease with cutting employees so deep, there needs to be a balance between the company's STAKEHOLDERS, not just the ones that own stock.
Money

United States

#4 Jun 22, 2012
FormerMgr wrote:
PLUS these shareholders are the ones that Wasson and company are trying to appease with cutting employees so deep, there needs to be a balance between the company's STAKEHOLDERS, not just the ones that own stock.
No. A for-profit company exists ONLY to make money for its shareholders. It has only obligations to the law and its shareholders, and noone else. All the other stuff about community and employees and stakeholders exists to serve its long term performance. For example, you treat your employees well enough so you can have a strong enough workforce in the future. Other than that, the company's ONLY obligation is to make more money for its shareholders.
If you don't like it, complain to the free market economy and feel free to move to Cuba or Venezuela

Since: Feb 12

Missouri City, TX

#5 Jun 22, 2012
Money wrote:
<quoted text>
No. A for-profit company exists ONLY to make money for its shareholders. It has only obligations to the law and its shareholders, and noone else. All the other stuff about community and employees and stakeholders exists to serve its long term performance. For example, you treat your employees well enough so you can have a strong enough workforce in the future. Other than that, the company's ONLY obligation is to make more money for its shareholders.
If you don't like it, complain to the free market economy and feel free to move to Cuba or Venezuela
And in their (and apperantly your) short-sightedness, they will hit their numbers by cutting costs and destroying good will built up over time, at least in the short term. However, if you don't know we will never be able to beat the cost cutting at large retailers or charge their lower prices (front our in the pharmacy). But what employees that cared about their company could do is provide service brings those retailers that justified the premium prices charged. Legally you are correct, the only obligation is to provide a return to investors, but lets see how long that return grows when the IDGAF's outnumber the ones that are holding out hope for a once great company. I believe in the free market, but customers have grown to expect a level of service at our stores that because of cuts can no longer be provided.

Since: Feb 12

Missouri City, TX

#6 Jun 22, 2012
Oh yeah, how has that free market economy worked for everyone the last 4 years when lead by short sighted greedy beyond embarassment ceos and banks. Go live in a store clerks, mgt, tech, or even now a pharmacists and managers house and then talk.

Since: Aug 07

Location hidden

#7 Jun 22, 2012
Money wrote:
<quoted text>
.....For example, you treat your employees well enough so you can have a strong enough workforce in the future. Other than that, the company's ONLY obligation is to make more money for its shareholders.
If you don't like it, complain to the free market economy and feel free to move to Cuba or Venezuela
I think the employee treatment is what most of us here is upset about.

The future workforce of Walgreens will not be strong. We have full time employees working 30-35hrs a week rather than 40. We have hot and humid uncomfortable work environments to save the company money on air conditioning. We have store managers trying to come up with ideas to make back that $6 billion in lost sales from ESI. We have DMs pushing harder and harder for MGRs to accomplish the impossible. Assitant management is forced to take paycuts while our leaders are take pay raises.

The employees are working because they HAVE TO. They use to work here becasue they WANTED TO.

Sure capitalism will dictate the employees are free to leave. But will that give the strong and competent workforce you described?

I honestly don't care how much Wasson and his gang makes. They can make billions per year in salary for all I care. But I think the majority of us would like to see sufficient staffing, a 40hr work week, and retaining the pay they hired us at.

Since: Aug 07

Location hidden

#8 Jun 22, 2012
From what I understand, the ESI conflict is understandable.

What Wasson was trying to prevent was the dominoe effect. If we give in to ESI's offer, the other PBMs will ask for the same. Why should they pay more than ESI?

Think of it as a troublesome customer who insists we sell our $5 cookies for $3 to him. If we do and others find out, every one will wan the cookies for $3. Do you stand your ground with that single customer or give in and lose it all?
Nick

Chicago, IL

#9 Jun 23, 2012
wagexa wrote:
From what I understand, the ESI conflict is understandable.
What Wasson was trying to prevent was the dominoe effect. If we give in to ESI's offer, the other PBMs will ask for the same. Why should they pay more than ESI?
Think of it as a troublesome customer who insists we sell our $5 cookies for $3 to him. If we do and others find out, every one will wan the cookies for $3. Do you stand your ground with that single customer or give in and lose it all?


The problem is 85% of other stores are selling the same cookies for $3 or less. I worked in RX for Wag. I was let go 2 months ago do to cutbacks. I now work for Walmart RX. I get a monthly prescription for $9 without insurance, a card, or discount. The same prescription at Wag would cost me $47 a month plus I have to purchase a card for $20 to get that $47 price. I save roughly $40 a month or $480 a year on 1 prescription. Why pay more money for the exact same cookies?

The ESI dispute is do to Wag trying to change the definition of what a generic drug is/was. Wag wants to buy the $5 box of cookies for $3 and then tell the actual consumer of the cookies we charge more because we are better than the other stores. Most consumers will pay the cheaper price and you can't blame them.

If you didn't work at Wag, would you be willing to spend more money on the exact same product just because of the name on the building?

Since: Aug 07

Location hidden

#10 Jun 23, 2012
Nick wrote:
<quoted text>
The problem is 85% of other stores are selling the same cookies for $3 or less. I worked in RX for Wag. I was let go 2 months ago do to cutbacks. I now work for Walmart RX. I get a monthly prescription for $9 without insurance, a card, or discount. The same prescription at Wag would cost me $47 a month plus I have to purchase a card for $20 to get that $47 price. I save roughly $40 a month or $480 a year on 1 prescription. Why pay more money for the exact same cookies?
The ESI dispute is do to Wag trying to change the definition of what a generic drug is/was. Wag wants to buy the $5 box of cookies for $3 and then tell the actual consumer of the cookies we charge more because we are better than the other stores. Most consumers will pay the cheaper price and you can't blame them.
If you didn't work at Wag, would you be willing to spend more money on the exact same product just because of the name on the building?
I was refering the the reimbursement rates we get from PBMs not the end user cost to consumers.$5 cookies does not equal the customer price of their prescripton. Bad example on my part maybe.

Wasson was trying to preserve the profit margin we got from PBMs. Lets say we get a 50% gross profit from all PBMs. But ESI only wants to let us have a 20% gross profit margin. We give that to ESI and others like Caremark will want the same. Then we will only make 20% gross profit on all prescriptions. That's definetly not good for the workers or the company at all.

All other pharmacies like CVS and Rite Aid are now enjoying the short term flood of customers. But the secretly were rooting for Walgreens to come out ahead. The goal of ESI was to lower reimbursement rates to all. They will suffer losses in the long term soon too.
browser

Jupiter, FL

#11 Jun 23, 2012
Money wrote:
<quoted text>
No. A for-profit company exists ONLY to make money for its shareholders. It has only obligations to the law and its shareholders, and noone else. All the other stuff about community and employees and stakeholders exists to serve its long term performance. For example, you treat your employees well enough so you can have a strong enough workforce in the future. Other than that, the company's ONLY obligation is to make more money for its shareholders.
If you don't like it, complain to the free market economy and feel free to move to Cuba or Venezuela
There is no such thing as a "free market economy". Laissez-faire does not exist.
Disgruntled at the top

Aurora, CO

#12 Jun 23, 2012
Money wrote:
<quoted text>
No. A for-profit company exists ONLY to make money for its shareholders. It has only obligations to the law and its shareholders, and noone else. All the other stuff about community and employees and stakeholders exists to serve its long term performance. For example, you treat your employees well enough so you can have a strong enough workforce in the future. Other than that, the company's ONLY obligation is to make more money for its shareholders.
If you don't like it, complain to the free market economy and feel free to move to Cuba or Venezuela
News flash. We are not in a free market. You'd like to think so but we are regulated. Just sayin. Now go fill the cooler.
nolongerwagslave

Deerfield Beach, FL

#13 Jun 23, 2012
We've actually been under a different flavor of communism since WWII. The Black Nobilty/Vatican/Holy Roman Empire decided that Soviet communism was no longer sustainable and opened up Russia to oligarchial looting in the 90's. Now it's our turn. The 20th century revolved around the central banking/warfare model. Now is a transition to a zero growth post industrial society where there is no room for a middle class.
The Bernank punted this week on more overt QE3 ( it actually never stopped). It appears that he won't act until circumstances arise that QE3 won't be headline news. Watch for a false flag event during the London Olympics to be pinned on Iran.
Nick

Chicago, IL

#14 Jun 23, 2012
wagexa wrote:
<quoted text>
I was refering the the reimbursement rates we get from PBMs not the end user cost to consumers.$5 cookies does not equal the customer price of their prescripton. Bad example on my part maybe.
Wasson was trying to preserve the profit margin we got from PBMs. Lets say we get a 50% gross profit from all PBMs. But ESI only wants to let us have a 20% gross profit margin. We give that to ESI and others like Caremark will want the same. Then we will only make 20% gross profit on all prescriptions. That's definetly not good for the workers or the company at all.
All other pharmacies like CVS and Rite Aid are now enjoying the short term flood of customers. But the secretly were rooting for Walgreens to come out ahead. The goal of ESI was to lower reimbursement rates to all. They will suffer losses in the long term soon too.
Does not matter what reimbursement % you receive if you have no customers. How is it that Wag has 8,000+ stores and Walmart has a little over 4,000 pharmacies but Wag would charge in my case 5X what I can purchase the exact same script for at Walmart? Just a guess but I would say Wag would have an edge in buying power for prescription drugs over Walmart. And in this one example, I have no insurance, psc or discount so Walmart is not getting any reimbursement from any third party. Wag is trying to sell their name. Even with the Alliance Boots merger/buyout, Wag is going to have to cut prices to match or be below insurance prices. If they don't, there will be no incentive to go to Wag other than the name Walgreens.
MGTonsauce

Clearlake, CA

#15 Jun 23, 2012
A for profit company also has obligations to stakeholders.

Since: Jun 12

United States

#16 Jun 23, 2012
wagexa wrote:
From what I understand, the ESI conflict is understandable.
What Wasson was trying to prevent was the dominoe effect. If we give in to ESI's offer, the other PBMs will ask for the same. Why should they pay more than ESI?
that is the spin corporate is putting on esi. when we bought duane reade , we were able to open their books and see they were paid more for their rx's. Walgreens then screams we want the industry reimbursement rates and will not sign the contract until we get the higher rates.guess what that led to.....do not drink the kool aid anymore and believe every explanation corporate gives us

Since: Aug 07

Location hidden

#17 Jun 23, 2012
Nick wrote:
<quoted text>
Does not matter what reimbursement % you receive if you have no customers....
It matters if you are trying to run a business and maintain your current profit margin.

Try to think longer term, not simple short term.

I'm not a fan of Wasson in any way. But the ESI battle was necessary.

Since: Jun 12

United States

#18 Jun 23, 2012
Nick wrote:
<quoted text>
Does not matter what reimbursement % you receive if you have no customers. How is it that Wag has 8,000+ stores and Walmart has a little over 4,000 pharmacies but Wag would charge in my case 5X what I can purchase the exact same script for at Walmart? Just a guess but I would say Wag would have an edge in buying power for prescription drugs over Walmart. And in this one example, I have no insurance, psc or discount so Walmart is not getting any reimbursement from any third party. Wag is trying to sell their name. Even with the Alliance Boots merger/buyout, Wag is going to have to cut prices to match or be below insurance prices. If they don't, there will be no incentive to go to Wag other than the name Walgreens.
walmart is not a pharmacy...their rx dept is a draw for the rest of the store. walgreens relies on a profitable rx division to remain sustainability.

Since: Aug 07

Location hidden

#20 Jun 23, 2012
Walgreens was the first domino. As much as you hate Wasson, you gotta give him credit for trying to stand up to ESI.
sadforwag

Killeen, TX

#21 Jun 23, 2012
22yearwagger is right I was told in a town hall meeting by wagner that since we had bought out some pharmacies and looked at their books we found out that esi was paying 5bucks more per rx. That was right after we got reade. Wake up people what is corp gonna say we are greedy, no they are gonna spin it. This is how you tell if wag is greedy....if you can say that your working conditions are better than3 yrs ago, making more money, more hrs for employees..then I am wrong

Tell me when this thread is updated:

Subscribe Now Add to my Tracker
First Prev
of 2
Next Last

Add your comments below

Characters left: 4000

Please note by submitting this form you acknowledge that you have read the Terms of Service and the comment you are posting is in compliance with such terms. Be polite. Inappropriate posts may be removed by the moderator. Send us your feedback.

Walgreens Discussions

Title Updated Last By Comments
Pharmacy Front End Alliance 6 hr Itdoesntmatter70 32
stars 7 hr WAG this 44
Anybody know the wic.... 13 hr itis 5
coupons 14 hr itis 25
I hate my job at Walgreens (Dec '12) 14 hr Thank you and omg... 100
2015 healthcare premium sticker shock 17 hr steel toed boots 21
Walgreens music playlist from 2011 to the present (Apr '12) 18 hr Greenswall 1,088
CL'S Meeting Today about Bonus Thu wagsuxs 21
Wait for it……... Sep 17 wag1234 141
•••

Walgreens People Search

Addresses and phone numbers for FREE

•••