Drugstore operator Walgreen Co. said Thursday it expects its pending departure from the Express Scripts Inc. pharmacy network to hurt its sales, earnings and cash flow during fiscal 2012.
The Deerfield, Ill., company did not specify the impact in a filing with the Securities and Exchange Commission. But it noted that Express Scripts, a pharmacy benefits manager, processed about 88 million prescriptions filled by Walgreen in fiscal 2011. That represented about $5.3 billion of the drugstore operator's sales out of $72.18 billion in total sales.
Express Scripts pays Walgreen and other drugstore operators to fill prescriptions. The companies have said since June that they were preparing to stop business once their three-year contract ends this year.
Walgreen has said it would rather give up the revenue it gets from Express Scripts than continue filling unprofitable prescriptions. But the nation's largest drugstore chain also has said it will try to keep as many of the Express Scripts prescriptions as possible by making its own arrangements with companies and health plans.
Walgreen reiterated in the filing Thursday that it expects to keep 97 to 99 percent of its fiscal 2011 prescription volume in the new fiscal year.
Analysts have said they expect Walgreen to lose most of the Express Scripts prescriptions.
Walgreen said earlier this month the Express Scripts decision cost it a penny per share in sales at pharmacies open at least a year and a penny per share in expenses during its fiscal first quarter.
In morning trading, Walgreen shares edged up 9 cents to $33.37.