After agreeing to invest $1 billion in Chicago primary care startup VillageMD earlier this year, Walgreens is now pouring more money into the firm as it makes plans to open 1,000 medical clinics at Walgreens locations in the coming years.
Walgreens announced Thursday that it has agreed to invest a total of $5.2 billion in VillageMD, a Chicago firm that operates its own primary care clinics and telehealth services, along with providing a health-tech platform to independent providers. The new investment increases Walgreens' stake in VillageMD from 30% to 63%. VillageMD will remain a standalone company with its own board and management, and is planning for a public offering in 2022, the company said.
The deal looks to accelerate the partnership between Walgreens and VillageMD, with the goal of opening at least 600 Village Medical at Walgreens primary care practices by 2025 and 1,000 by 2027. More than half of those practices will be in "medically underserved communities," the company said, and will look to increase access to care to people across the country. More than 75 percent of Americans live within five miles of a Walgreens, the company said.
VillageMD was founded in 2013 by Tim Barry and Clive Fields. The company has grown quickly in recent years, increasing revenue from $217 million in 2017 to an expected $1.3 billion in 2021. VillageMD currently operates over 230 practices in 15 cities.
Walgreens and VillageMD currently have 52 primary care practice locations open, and expect to have more than 80 open by the end of this year. Walgreens says it's now the first national pharmacy chain to offer full-service primary care practices at its stores.
