Walgreens' Potential Windfall From Obamacare

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Oct. 1 (Bloomberg) -- Bloomberg's Olivia Sterns explains how Walgreen Co. stands to profit from the Affordable Care Act. She speaks with Julie Hyman on Bloomberg Television's "Money Moves." (Source: Bloomberg)

The story.

Connect the dots, how is walgreen co.

To make money from the affordable care act?

They are in a great position to profit from this act.

Essentially what they are our six cost business models and thereby to get millions of more customers walking through the door.

That is a lot more margin without a lot of work.

The health reform mandated drug coverage, that is two thirds of the overall business.

They're helping spread the word.

They have a website we can go on and contact insurance advisors.

Cvs has a similar strategy in place, they are going to have 5000 in-store events.

They have preferred insurance partners.

How much extra margin?

It all depends on who signs up, not just how many people sign up at how healthy those people are.

Unfortunately sicker people are more profitable.

They need more drugs.

It's thought it will add one or sent to two percent on sales next year, that is $750 million.

That is two thirds of their business.

Speaking of the drug makers behind the prescription drugs as well as over-the-counter drugs, big news today, cutting 8500 jobs on top of another 7500. they are at a total 20% of their workforce.

They have a new head of r&d, they broaden this man back in april.

What we heard today was really his overhaul of the new r&d strategy.

We spoke to the ceo, he said basically what they want to do is focus on areas of research where they think he can really lead -- were they think merck can really lead.

Essentially what sums it up is what you get his breakthrough research is going to be our most sustainable advantage.

He says it is not fixing a broken model but reorienting for long-term growth.

It seems like investors are liking it.

I do so much in we will be on the markets

This text has been automatically generated. It may not be 100% accurate.

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