NEW YORK (AP) â€" Walgreen's first-quarter gain fell some-more than 4 percent due in partial to a delayed influenza deteriorate and a imminent separate from a Express Scripts pharmacy network, a multibillion-dollar brawl that looks no closer to fortitude in a final days of a year.
Since June, Walgreen and Express Scripts have pronounced they were scheming to stop doing business when a three-year agreement expires during a finish of 2011. Walgreen gets $5.3 billion in annual income from Express Scripts, though a Deerfield, Ill., association has pronounced it would rather give that adult than continue stuffing unprofitable prescriptions.
President and CEO Greg Wasson pronounced a association done one final try final week to come to terms with Express Scripts, though a dual sides were incompetent to solve their differences.
Walgreen stays open to another offer, Wasson said.
Unless a companies strike a last-minute deal, many people whose medication drug advantages are rubbed by Express Scripts won't be means to fill their prescriptions during Walgreen stores, starting in January. Express Scripts clients embody WellPoint Inc., that is a largest U.S. health insurer formed on membership, and TriCare, a health devise that serves troops members and their families.
Walgreen is a biggest drugstore sequence in a U.S. with 7,812 locations.
Shares of Walgreen fell as most as 8.1 percent in early trading, though after recovered and sealed down 13 cents during $33.37 while a broader markets edged adult reduction than 1 percent.
The preference to stop doing business with Express Scripts cost Walgreen a penny per share in sales during pharmacies open during slightest a year and a penny per share in losses during a mercantile quarter.
The association also took a assign of 1 cent per share from a miss of a normal cough, cold and influenza season. Walgreen administered 5 million influenza shots by Nov. 30 compared with 5.6 million a year ago.
Net income fell to $554 million, or 63 cents per share, from $580 million, or 62 cents per share, a year ago, when it had some-more shares outstanding. Revenue grew 4.7 percent to $18.16 billion, though selling, ubiquitous and executive losses climbed 5 percent given of a merger of drugstore.com and other items.
Analysts surveyed by FactSet expected, on average, gain of 67 cents per share and $18.24 billion in revenue.
In a arise of a Express Scripts stalemate, Walgreen is perplexing to reason on to as many prescriptions as probable by creation a possess arrangements with companies and health plans. Based on prescriptions Walgreen is stuffing in Dec and other trends, a association pronounced it expects to keep between 97 percent and 99 percent of a 2011 medication volume.
Barclays Capital researcher Meredith Adler pronounced that projection suggests Walgreen will remove between 60 and 84 percent of a Express Scripts prescriptions. Competitor CVS Caremark Corp. pronounced Tuesday that it believes it could collect adult 17 million to 23 million prescriptions as a outcome of a dispute.
Analysts contend a separate will also harm sales of other products, given fewer shoppers would be selling during Walgreen stores.
Another intensity emanate for Walgreen is that Express Scripts is in a routine of shopping Medco Health Solutions Inc., another vast pharmacy advantages manager. If that understanding goes through, Walgreen might remove Medco's clients over time.
Earlier this month, Walgreen pronounced sales during stores open during slightest a year grew 2.5 percent during a quarter, though it pronounced a Express Scripts quarrel reduced those sales by 1.1 percent. Sales during stores open during slightest a year are deliberate a pivotal dimensions of tradesman health given they bar formula from stores that have non-stop or sealed in a final year.
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Tom Murphy contributed to this story from Indianapolis.
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