The news: Primary care disruptor One Medical is weighing a takeover, per Bloomberg.
Is CVS going tit for tat with Walgreens? CVS’ interest in One Medical could be a play to deepen its brick-and-mortar clinics as Walgreens builds up its own clinics via VillageMD.
Last year, CVS announced its plan to convert 900 of its retail stores (10% of its US locations) into primary care offices and mirror traditional doctors’ offices. We posited CVS’ plans are likely a move to counter competitor Walgreens’ $5.2 billion investment in primary care clinics VillageMD.
One Medical’s virtual and in-person clinics could give CVS another layer of armor against Walgreens.
The larger trend: One Medical could be seeking shelter under a healthcare giant’s roof as health tech companies become more financially cautious in an era of economic uncertainty.
One Medical’s peers are laying off employees as they focus on profitability amid the looming recession.
It’s likely One Medical wants to tap the muscle and funding of a retail giant like CVS before it has to cut employees or make major organizational changes to continue operations.