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Walgreens ends fiscal year with 5.8% sales lift to $76.4 billion

BY Michael Johnsen

DEERFIELD, Ill. — Walgreens on Thursday reported August sales of $6.4 billion, an increase of 3.6% from the same month in fiscal 2013. Total sales for fiscal 2014 were $76.4 billion, an increase of 5.8% from fiscal 2013. 
 
Total front-end sales increased 2.1% in August compared with the same month in fiscal 2013, while comparable-store front-end sales increased 1.4%. Customer traffic in comparable stores decreased 1.7% while basket size increased 3.1%.
 
Prescriptions filled at comparable stores increased by 1.1% in August and increased 3.2% on a calendar day-shift adjusted basis. August 2014 had one additional Sunday and one fewer Thursday compared with August 2013. These calendar shifts negatively impacted prescriptions filled at comparable stores by 210 basis points.
 
August pharmacy sales increased by 5.4%. Comparable-store pharmacy sales increased 5% and increased by a calendar day-shift adjusted 7.1%. Calendar day-shift adjusted comparable-store pharmacy sales were negatively impacted by 180 basis points due to generic drug introductions in the last 12 months. Pharmacy sales accounted for 65.7% of total sales for the month.
 
Sales in comparable stores increased by 3.7% in August. Calendar day shifts negatively impacted total comparable sales by 140 basis points. Generic drug introductions in the last 12 months negatively impacted total comparable sales by 120 basis points.
 
Total sales for fourth-quarter 2014, which ended Aug. 31, were 19.1 billion, up 6.2%. Comparable store sales for the fourth quarter of fiscal 2014 increased 5.6%, while front-end comparable store sales for the quarter increased 1.3%. Prescriptions filled at comparable stores increased 3.9% in the fourth quarter and comparable pharmacy sales increased 8.2%.
 
Calendar 2014 year-to-date sales for the first eight months were $50.9 billion, an increase of 5.7% from $48.2 billion in 2013.
 
Walgreens stated on its Aug. 6, 2014, conference call with analysts that in the fourth quarter, it expected gross profit margin to be down a similar percentage year-over-year to what was experienced in the third quarter. This is due to ongoing gross profit margin pressures, including recent changes in the environment of the company's pharmacy business including ongoing generic drug inflation, reimbursement pressure and a shift in pharmacy mix toward 90-day prescription refills at retail locations and Medicare Part D. The company also pointed out that last year's fourth quarter included net gains from certain litigation matters, which reduced selling, general and administrative expenses by just under 1 percentage point.
 
Walgreens opened 23 stores during August, including four relocations, and closed five. On Aug. 31, Walgreens operated 8,309 locations in all 50 states, the District of Columbia, Puerto Rico and the U.S. Virgin Islands. That includes 8,206 drug stores, 91 more than a year ago, including 70 net stores acquired over the last 12 months. The company also operates infusion and respiratory services facilities, specialty pharmacies and mail service facilities. Its Take Care Health Systems subsidiary manages more than 400 in-store convenient care clinics.
 
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BlueCross BlueShield of Western New York names Walgreens as its specialty pharmacy provider

BY Michael Johnsen

BUFFALO, N.Y. — BlueCross BlueShield of Western New York on Wednesday welcomed Walgreens to the health plan’s retail pharmacy network and named the retailer the plan's specialty pharmacy provider. 
 
The agreement allows BlueCross BlueShield members to fill their standard prescriptions at more than 30 Walgreens locations in the eight counties of Western New York, and at more than 8,000 locations nationwide. Along with home delivery of specialty medications, Walgreens Specialty Pharmacy staff will work closely with members and their physicians to provide ongoing, individualized support. 
 
With the addition of Walgreens, BlueCross BlueShield’s retail pharmacy network expands to 359 retail locations locally and nearly 70,000 nationwide. 
 
“We are pleased to welcome Walgreens to our already expansive retail pharmacy network,” stated Thomas Schenk, BlueCross BlueShield SVP and chief medical officer. “Walgreens meets our high standards of quality and safety and the addition of these locations offers even more convenience for our members.” 
 
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Study: Adequate sleep reduces absence from work due to sickness

BY Michael Johnsen

DARIEN, Ill. — New research suggests that sleeping seven to eight hours per night is associated with the lowest risk of absence from work due to sickness, the National Healthy Sleep Awareness Project reported Wednesday. The results underscore the importance of the “Sleep Well, Be Well” campaign of the National Healthy Sleep Awareness Project, a collaboration between the Centers for Disease Control and Prevention, American Academy of Sleep Medicine and Sleep Research Society.

 
Results show that the risk of an extended absence from work due to sickness rose sharply among those who reported sleeping less than six hours or more than nine hours per night. Further analysis found that the optimal sleep duration with the lowest risk of sickness absence from work was between seven and eight hours per night: seven hours, 38 minutes for women and seven hours, 46 minutes for men. Insomnia-related symptoms, early morning awakenings, feeling more tired than others, and using sleeping pills also were consistently associated with a significant increase in workdays lost due to sickness. 
 
“Optimal sleep duration should be promoted, as very long and very short sleep indicate health problems and subsequent sickness absence,” stated principal investigator Tea Lallukka, specialized researcher at the Finnish Institute of Occupational Health. “Those sleeping five hours or less, or 10 hours or more, were absent from work every year for 4.6 to 8.9 days more, as compared to those with the optimal sleep length.”
 
The study results are published in the September issue of the journal Sleep.
 
“Insufficient sleep – due to inadequate or mistimed sleep – contributes to the risk for several of today’s public health epidemics, including cardiovascular disease, diabetes and obesity. Getting at least seven hours of nightly sleep is a key to overall health, which translates to less sick time away from work,” commented American Academy of Sleep Medicine president Timothy Morgenthaler, a national spokesperson for the Healthy Sleep Project. The “Sleep Well, Be Well” campaign was launched earlier this year to increase awareness of the importance of sleep as one of the three pillars of a healthy lifestyle. 
 
 
 

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