Microsoft has struck a deal with Walgreens (WBA) to build digital health tools for pharmacy customers that will include efforts to use artificial intelligence to deliver stepped-up telehealth, improve medication adherence, and reduce emergency room visits.
The impact of the seven-year partnership, announced Tuesday, remains to be seen, but it represents another attempt by a large provider of health care services to increase the use of technology to deliver medicines and medical advice.
The world’s largest technology companies, including Apple, Amazon (AMZN), and Google (GOOGL), are making aggressive forays into health care, both through partnerships with providers and the development of their own health care businesses.
Executives with Microsoft said the company will become the cloud services provider to Walgreens, which will move its data onto Microsoft’s Azure platform to enable the use of Microsoft’s analytics capabilities.
Walgreens said it will pilot up to 12 in-store “digital health corners” in 2019 to sell health-care-related hardware and devices, and will focus on delivering stepped-up preventive care and personalized treatment for patients with chronic illnesses. The company’s portfolio of retail and business brands includes Walgreens, Duane Reade, Boots, and Alliance Healthcare, as well as health and beauty product brands, such as No7, Soap & Glory, Liz Earle, Sleek MakeUP, and Botanics. It operates about 400 in-store clinics through an independent vendor.
“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,” said Stefano Pessina, CEO of Walgreens Boots Alliance.
It will also help Walgreens compete against its main rival, CVS (CVS) Health, which acquired the health insurer Aetna to build similar data tools and deliver more basic health care services in the pharmacy. Amazon, through its nearly $1 billion acquisition of the online pharmacy PillPack, is also taking aim at the pharmacy business, where its data storage and analysis capabilities could make it a strong competitor.
Although these huge companies are building up their digital health services, it is not yet clear whether consumers will buy into the new delivery model, or can save significant money by doing so.