Walgreens 2010 Annual Report Download - page 5

Building upon these successes and our core strengths – the best, most convenient store network in America,
our trusted and iconic brand, and our strong balance sheet and financial flexibility – we remain confident
our momentum will continue as we advance our strategies to increase shareholder value.
The “new” consumer in our changing economy
The long and difficult recession has markedly changed consumer buying habits, behaviors and attitudes.
We believe the “new” value-minded consumer is here to stay. In response, we have fine-tuned our mer-
chandising to deliver greater value, with more emphasis on day-to-day necessities, including an expansion
of our strong private brand products. And, through our CCR initiative, we are enhancing the “look
and feel” of our stores, while also adding convenience products such as beer and wine, and providing an
assortment of fresh foods to meet the daily living needs of today’s busy and value-focused consumer.
The transformation of America’s health care system
The health care reform bill signed into law in March 2010 represented the nation’s most significant change
to health care since Medicare’s passage in 1965. The legislation’s objective of improving access to quality,
affordable, preventive care puts Walgreens in a prime position to provide pharmacy, health and wellness
solutions to patients and payers – employers, health plans, pharmacy benefit managers, health systems
and government agencies. With the heightened national attention to health care and 32 million more
Americans gaining access to coverage in 2014, we see substantial growth opportunities for Walgreens.
Meeting America’s “health and daily living” needs
Walgreens is uniquely positioned to meet the health and daily living needs of today’s consumer.
Our “center of gravity” is our more than 7,500 Walgreens drugstores. With nearly 75 percent of
Americans living within five miles of a Walgreens, we are providing convenient access to goods and
services across thousands of communities. From expanded grocery offerings in an urban “food desert,”
with limited or no access to fresh food, to prescription and health care services in a medically
underserved community, “My Walgreens” is there.
This can be seen in our hometown where, working with the City of Chicago, Walgreens is expanding
our grocery offerings to Chicago’s south and west side residents by adding an assortment of fresh food
in nearly a dozen stores in these neighborhoods.
Our Community Management program is strengthening our relationships in communities across America.
Nationwide, more than 1,300 Walgreens Community Leaders, responsible for all the Company’s services
within their community, participated in more than 7,500 community events during fiscal 2010. To our
customers and prospective customers, these activities increase the relevance of Walgreens as an important
partner in their communities.
With our network of drugstores in all 50 states and Puerto Rico, including 116 hospital on-site pharmacies,
our more than 700 retail clinics and worksite health centers, and our 70,000 health care service providers,
Walgreens is truly on the frontline of health care. Through our pharmacy and expanding health and
wellness services – including acute and chronic care, screenings, flu shots and other immunization and
infusion services – we are helping millions of patients to get well, stay well and live well.
Preventing and managing chronic medical conditions are the biggest challenges confronting America’s health
care system. Walgreens is leading the way by offering innovative programs that can change how patients
manage their prescriptions for conditions like diabetes and other chronic illnesses. These patients can obtain
90-day supplies of medications from their trusted Walgreens community pharmacist, making it more
convenient for them to easily receive and stay compliant with their prescriptions. Studies have shown
that greater compliance and adherence to prescription drugs is the best way to improve the quality of
health while reducing costs for patients with chronic illnesses.
Walgreens offers specialty pharmacy services for patients who have complex, chronic health conditions
and need additional counseling and support. Medications for cancer, multiple sclerosis, rheumatoid
arthritis and other conditions can be expensive, require completion of additional forms and are often
difficult to administer. Walgreens community pharmacists, supported by teams of highly specialized
pharmacists, nurses and patient care coordinators, help patients navigate these issues and provide
support throughout the patient’s treatment.
Many of these patients rely on Walgreens industry-leading infusion services to administer a rapidly
growing number of biologic medications. Through these services, we are meeting the needs of patients
in the comfort of their homes and reducing the costs associated with extended hospital visits.
As we broaden our services, we are expanding their delivery online. Walgreens.com recently introduced
Pharmacy Chat, enabling patients to have their medication questions answered online by our pharmacists
and pharmacy technicians 24 hours a day. We also launched a mobile website, and iPhone and other smart
phone applications, providing expanded services such as text messages when a prescription is ready for pickup.
Earnings
In billions of dollars
Sales
In billions of dollars
2010 Walgreens Annual Report Page 3
* Striped portion represents after-tax
restructuring costs of $163 million.
** Striped portion represents after-tax
restructuring costs of $67 million,
after-tax Duane Reade costs of
$56 million, and $43 million of taxes
related to the elimination of the
Medicare Part D tax benefit for retirees.
* **
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