Just last year Express Scripts Holding Co., who is one of Walgreen Co. largest customers, filed a lawsuit alleging the drug store is trying to lure away its customers, by telling its plan members they will no longer be able to fill prescriptions at Walgreen drugstores.
Walgreen also issued a statement, claiming it will no longer do businesses with Express Scripts because Express Scripts will be cutting payments to unacceptable low standards.
Thursday morning both companies reached a settlement, mending their once broken relationship. The contract will be a multi-year pharmacy network agreement that will permit customers of Express Scripts to be able to fill their prescriptions once again at Walgreen. Though the terms were not released, the contract goes into effect September 15, 2012.
Following the announcement, Walgreen’s stock price increased by 15 percent during pre-market trading. Express Script’s shares increased by 4 percent.
During the seven month dispute, Walgreens suffered an estimated loss of $5 million and stocks fell by 30 percent.
Greg Wasson, Walgreens’ president and chief executive, expresses his contentment for the new contract between the companies. According to Wasson the agreement will benefit not only the company, its employees and shareholders, but also the patients and communities they serve on a day-to-day basis.
"I am pleased that Walgreens and Express Scripts have been able to reach an agreement that works for both parties and is consistent with our company's principles," Wasson said.
Express Scripts will now have one of the broadest networks thus far, operating with more than 64,000 pharmacies nationwide.
In addition to this new contract, Walgreens, which is the largest U.S. drugstore chain, has sought to improve its shares by expanding outside of the United States to Europe and investing in health and beauty group Alliance Boots Holding Ltd.