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George Riedl wasn’t at Walmart very long before he helped the retail and pharmacy giant adapt to the changing marketplace for generic drug purchasing.
Riedl at a Walmart Neighborhood Market pharmacy.
Upon arriving at Walmart late last year as senior vice president and president of the health and wellness business, Riedl — who spent most of his career at Walgreens — quickly recognized that the company needed to keep pace in generic drug sourcing.
Walgreens and Alliance Boots had established a buying organization in Bern, Switzerland, which subsequently attracted AmerisourceBergen as a partner. The creation of Walgreens Boots Alliance Development prompted CVS Health and Cardinal Health to form Red Oak Sourcing, and then Kroger Co., Supervalu Inc. and Express Scripts to found Econdisc Contracting.
In mid-May, Walmart announced a joint sourcing agreement for generics with McKesson. From Walmart’s perspective, the deal — which also expanded the companies’ long-term distribution pact — keeps the retailer on a level playing field with CVS and Walgreens, the nation’s biggest dispensers of prescriptions.
“We dominate in so many categories and don’t normally need partners,” Riedl said. “But in today’s world of generics purchasing, where the other big players have pooled their resources, on our own we would have been fifth-best, and that would have put us at a competitive disadvantage.”
He said he devoted a good deal of time during his first months on the job to hammering out the generics sourcing venture with McKesson, and the result of those efforts represents something of a departure for Walmart.
“The agreement with McKesson is a new approach for Walmart,” Riedl said. “When the team focused on the opportunity and took a look at the numbers, everyone realized it was the right thing to do for the company and for our customers.”
