While Deerfield, Ill.-based Walgreens Boots Alliance is reportedly in discussions to acquire AmerisourceBergen, analysts speculate the move may fail to keep Walgreens competitive in an ever-changing healthcare market, Reuters reports.
Analysts note Walgreens' intent with the proposed deal is to keep pace with its rival, Woonsocket, R.I.-based CVS Health, which declared plans to purchase Aetna last year, and possibly head off any threat Amazon may pose if the retail giant enters the drug market. However, analysts speculate the move may prevent Walgreens from engaging in certain opportunities down the line. Any cost-saving potential the deal could provide may also not be realized for some time, as Walgreens is still in the midst of completing its $4.38 billion amended asset purchase agreement with Camp Hill, Pa.-based Rite Aid.
"We're currently struggling to see the strategic allure of the [AmerisourceBergen] combination for Walgreens," a Baird analyst told Reuters.
Analysts claim the proposed CVS-Aetna deal will create a healthcare giant and widen CVS' reach in the market, whereas the proposed Walgreens-AmerisourceBergen deal would not accomplish similar goals for Walgreens, the report states.
The deal would, however, provide Walgreens with a stronger presence in the specialty pharmacy space, competing against CVS and pharmacy benefit manager Express Scripts, analysts claim.