June 29 (Bloomberg) -- Walgreen Co., the biggest U.S. drugstore chain by revenue, agreed to buy Medmark Holdings Inc. to boost sales of treatments for chronic illnesses.

Pittsburgh-based Medmark sells injections and oral medications for patients with conditions such as cancer, hepatitis and multiple sclerosis, Deerfield, Illinois-based Walgreen said. Terms of the transaction weren't disclosed.

Walgreen is trying to take advantage of rising demand for higher-priced biotech drugs. Sales of the therapies grew 17.2 percent last year, compared with a 1.7 percent increase in name- brand drug sales, according to IMS Health Inc., a Fairfield, Connecticut-based company that tracks prescription trends.

The drugstore chain last year purchased Home Pharmacy of California and Schraft's A Specialty Pharmacy LLC, based in Livingston, New Jersey. Earlier this year, it bought Canadian Valley Medical Solutions Inc.

The purchase will probably be completed this summer, Walgreen said. Stan Blaylock, who helped found Medmark in 2003, will continue as president of the unit. The company will remain in Pittsburgh.

LLR Partners Inc., a $620 million private-equity firm, and Quaker BioVentures, a $280 million venture-capital firm, both based in Philadelphia, are the sellers.

Walgreen shares gained 92 cents, or 2.1 percent, to $44.94 as of 4 p.m. in New York Stock Exchange composite trading. The stock has risen 2.3 percent this year.

To contact the reporter on this story: Josh Fineman in New York at jfineman@bloomberg.net.

Last Updated: June 29, 2006 16:46 EDT