Artificial Intelligence

Walgreens and Microsoft partner on healthcare delivery innovation

The 7-year strategic partnership is meant to combine Microsoft's AI and cloud infrastructure with Walgreens' retail footprint and outpatient services to create new tech-enabled ways of accessing and receiving care.

As the impending threat of Amazon’s healthcare disruption moves closer to reality, traditional healthcare players are attempting to see what competitive advantage can be gained by boosting their technology prowess through partnership.

Case in point: Walgreens Boots Alliance Inc., one of the country’s largest pharmacy chains, has teamed up with tech giant Microsoft as part of an effort to innovate new, more integrated, healthcare delivery models using technology.

The 7-year strategic partnership is meant to combine Microsoft’s AI and cloud infrastructure with Walgreens’ retail footprint and outpatient services to create new tech-enabled ways of accessing and receiving care. In line with its innovation efforts, Walgreens will open up to 12 in-store “digital health corners” over the year focused on selling healthcare oriented devices.

One of the major initiatives of the partnership is giving Walgreens customers access on-demand virtual care and building the data infrastructure and pipelines to health information systems to allow clinicians to better support medication adherence, divert costly emergency room visits and reduce hospital readmissions.

AI will play a major role in harnessing Walgreens extensive patient data to track outcomes and determine the medications and therapies at the point of care.

As part of the deal Microsoft will become Walgreens strategic cloud provider and the pharmacy company will migrate the bulk of its IT infrastructure onto the Microsoft Azure platform. Walgreens will also roll out the Microsoft365 software suite to its more than 380,000 employees around the world.

The companies have also committed to a multiyear R&D partnership to work on tech-oriented healthcare products, which could lead to the establishment of joint innovation centers. A potential area of collaboration is developing lifestyle management solutions focused on preventive health and chronic disease management.

Arielle Trzcinski, a senior analyst at Forrester, said that retail pharmacies can function as a community-based touch point for patients who don’t often see their provider and handle health issues before they become critical. This role will only get more vital as rural providers face increased risk of closure.

“Consumers will turn to retail locations like Walgreens, Walmart, and CVS for convenient care options as well as virtual care delivery to fill the gap,” Trzcinski wrote in an email.

CVS Health’s Aetna acquisition – along with new entrants to the healthcare industry – has put a fire under Walgreens to also find partners which can extend its reach past the retail pharmacy space. A few recent examples include a senior clinics deal with Humana and a tie-up with Alphabet life science arm Verily to tamp down healthcare costs.

“Our strategic partnership with Microsoft demonstrates our strong commitment to creating integrated, next-generation, digitally enabled health care delivery solutions for our customers, transforming our stores into modern neighborhood health destinations and expanding customer offerings,” Walgreens Boots Alliance CEO Stefano Pessina said in a statement.

“WBA will work with Microsoft to harness the information that exists between payors and health care providers to leverage, in the interest of patients and with their consent, our extraordinary network of accessible and convenient locations to deliver new innovations, greater value and better health outcomes in health care systems across the world.”

Photo: Joe Raedle, Getty Images

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