Roz Brewer has resigned as president and CEO of Walgreens Boots Alliance, the business announced on Friday.
Additionally, she resigned from the company’s board on Thursday. According to a news release, the choice was mutual.
In premarket trade, the shares of Walgreens were essentially unchanged.
While the company looks for a replacement, Ginger Graham, the lead independent director and a seasoned member of the healthcare sector, will serve as acting CEO. Graham has extensive experience in the medical field.
Brewer has promised to continue advising the business up until a permanent CEO has been chosen. She didn’t respond right away to calls for comment.
According to Stefano Pessina, executive chairman of Walgreens, “Our Board and Leadership Team will increase our focus on generating value for our customers & our shareholders when we advance our search for a successor with significant healthcare experience to take over in today’s dynamic environment.”
Prior to Friday’s statement, Brewer and Walgreens were having some trouble. As of Thursday’s close, shares of Walgreens had lost more than 32% of their value for the year as the business battled a decline in demand for COVID testing & vaccines. Additionally, front-end retail sales for products like toothpaste and shampoo have been steadily declining as consumers turn to rivals like Walmart and Amazon for those basic essentials that can be acquired online and delivered within a few days.
For the first time since July 2020, the company’s fiscal third-quarter earnings were below Wall Street projections when they were disclosed in June. Additionally, it drastically cut its annual profit forecast.
However, Covid instances are once again on the rise, which may be good news for pharmacy sales. Mid-September is the anticipated launch date for the following Covid boosters.
Walgreens offers the standard over-the-counter cold and flu medications for customers who might not be interested in another COVID booster. An early cold and flu season increased demand for cough and cold medications during Walgreens’ first fiscal quarter, which concluded on November 30. This helped the retailer balance its losses from a slowdown in vaccine demand.
A former retail employee working in the healthcare industry
Brewer has been in charge of Walgreens since March 2021 and has experience at both Walmart and Starbucks. The firm pursued a change that would portray Walgreens less as a pharmacy chain and more as a healthcare provider during her brief years of service, which included a significant portion of the COVID epidemic.
Recent acquisitions by Walgreens include Summit Health and the primary care provider VillageMD, which together have opened hundreds of clinics, some of which are close to Walgreens outlets.
Additionally, it reached agreements with Shields Health Solutions, a specialist pharmacy, and CareCentrix, which arranges home care for patients after they are released from the hospital.
A healthcare model has also been embraced by rival CVS Health Corp. It made plans to purchase Oak Street Health Inc. in February for around $9.5 billion in cash so that it could expand the range of medical services it provides to include primary care. In the meantime, Rite Aid Corp. has concentrated on growing its pharmacy footprint and is apparently getting ready to file for bankruptcy.
Brewer’s skill set, however, is less in line with the company’s objectives as Walgreens moves more away from its identity as a chain of drugstores and toward its ambitions to become a health care provider. She formerly led Walmart’s Sam’s Club as its CEO and held the positions of group president and operations chief at Starbucks. She had held a number of management jobs with Walmart for almost ten years.
Walgreens just does not want to pursue the retail segment of the business, wherein Ms. Brewer has considerably more experience, as a significant growth potential, according to retail analyst and managing director of GlobalData Neil Saunders.
“Ms. Brewer must be disappointed by all of this, but it also indicates that a different set of skills are required to run the company. It is noteworthy that Ginger Graham, the temporary CEO, has considerably more extensive expertise in the pharmaceutical and healthcare sectors,” he continued.