After weeks of rumours, CVS Health announced plans to acquire Oak Street Health, a primary care provider geared toward Medicare populations, in a deal valued at approximately $10.6 billion.
Chicago-based Oak Street Health operates 169 clinics in 21 states, employing approximately 600 primary care providers. CEO Mike Pykoz will continue to lead the company following the completion of the deal, which the companies expect this year.
Planned acquisition marks another big step in healthcare delivery for retail players Walgreens, Walmart and Amazon. In the earnings call, CVS Health President and CEO Karen S. Lynch said that teaming up with the pharmacy giant will allow the primary care provider to be in touch with patients more often and more easily.
“Combining Oak Street Health’s platform with CVS Health’s unmatched reach will create a leading value-based primary care solution,” Lynch said in a statement. “Enhancing our value-based offerings is critical to our strategy as we continue to redefine how people access and experience care that is more affordable, convenient and connected.”
big trend
The announcements come after rumors swirled for weeks about a possible acquisition. In January, Bloomberg reported that the pharmacy giant is exploring a possible acquisition of Oak Street Health, and earlier this week wall street journal Said takeover was coming soon.
It Also Makes Another Great Deal for CVS , Planned Purchase of Home Care Platform Signify Health for $8 billion – subject to regulatory review.
CVS sees a huge opportunity to expand Oak Street Health, saying the primary care provider will have more than 300 centers by 2026.
According to BTIG Healthcare IT and Digital Health Analyst David Larson, Oak Street Health got a good deal at $39 a share. Other big moves in the market like Amazon’s planned purchase Primary care providers One Medical and Cigna’s investments in VillageMD are likely “what CVS Health is willing to pay for OSH.”
On the record
“This agreement with CVS Health adds to our mission and our ability to continue improving health outcomes, reducing medical costs and providing superior patient experiences while delivering significant value to our shareholders,” Pykoz said in a statement. will accelerate.”
“Together with CVS Health, we will have access to greater resources and capabilities to expand the reach of our platform, provide more opportunities for our partners and, most importantly, the patients we serve.” make a meaningful difference in their lives.”
