Coming off a tumultuous year in which Walgreen lost millions of customers in a contract dispute with a pharmacy benefits manager, executives of the Deerfield-based pharmacy chain sought to reassure shareholders on Wednesday of better days ahead.
At its annual meeting at Navy Pier, Walgreen leaders told a lively crowd of about 2,000 that its new international footprint, a loyalty card and other initiatives, including an enhanced selection of fresh foods and a continued expansion of health care services, have positioned the company for long-term success.
Walgreen Chief Executive Greg Wasson defended its controversial decision a year ago to walk away from a contract with the pharmacy benefit manager Express Scripts Holding Co., whose customers accounted for nearly 11 percent of the total prescriptions Walgreen's filled in 2011. As a result, Walgreen hemorrhaged sales throughout much of the year and its share price tanked.
Shareholders peppered Wasson about the decision, which analysts and others have said could result in the permanent loss of some of its customers.
Nonetheless, Wasson said, "I believe we're a much stronger company today ... it was absolutely the right thing for our shareholders in the long term."
Wasson also faced heat for its decision last June to shell out $6.7 billion for a 45 percent stake in a European pharmacy chain.
Investors sent Walgreen shares down more than 9 percent after the announcement that it would acquire a portion of Alliance Boots GmbH, pushing its stock price below $29, a level not seen for nearly two years.
Michael Pryce-Jones, a senior governance researcher for CtW Investment Group, an activist group that works on behalf of union pension funds, said Walgreen entered into the deal at the wrong time and paid too much.
"The fact is, this is too big a bet going on in a very troubled part of the world," Pryce-Jones said of the deal.
Pryce-Jones implored Walgreen's board to consider bringing the measure to a vote at its 2014 annual meeting, a year before the company is expected to acquire the remaining 55 percent of Alliance Boots.
Walgreen Chief Financial Officer Wade Miquelon said the company conducted "a tremendous amount of due diligence" before agreeing to the pact, which he said remains a "compelling strategic opportunity."
pfrost@tribune.com | Twitter: @peterfrost
Walgreen defends Express Scripts, Alliance Boots moves
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Walgreen defends Express Scripts, Alliance Boots moves
