DEERFIELD, Ill., Oct. 21, 2008 – Walgreen Co. (NYSE, NASDAQ: WAG) today announced a definitive agreement in which Walgreens will acquire McKesson Corporation’s (NYSE: MCK) specialty pharmacy, which is a business within McKesson’s Specialty division. Terms of the agreement were not disclosed. The acquisition will further strengthen Walgreens position as the fourth-largest specialty pharmacy in the country. Subject to satisfaction of customary conditions, the parties expect the transaction to close within 60 days.

"The acquisition of McKesson’s specialty pharmacy operations offers the opportunity to grow our own specialty pharmacy business with preferred payor agreements," said Stanley B. Blaylock, president of Walgreens Health Services. "This transaction will broaden access for patients and clients in the fast-growing oncology area and other specialty areas including multiple sclerosis, rheumatoid arthritis and reproductive health services."

The acquisition includes the McKesson specialty pharmacy in Pittsburgh, Pa.; and IVPCARE based in Frisco, Texas, with operations in Torrence, Calif., Wilmington, Mass. and St. Louis.

"We welcome this addition to our specialty pharmacy business," said Michael A. Nameth, executive vice president of Walgreens Health Services. "Both organizations complement each other with disease-focused care teams and enhanced clinical and therapy management programs. Together, we will provide the highest level of quality and customer service for the patients and clients we serve."

Walgreens Specialty Pharmacy LLC., a wholly-owned subsidiary of Walgreen Co. operated by its managed care division, Walgreens Health Services, is a national provider of injectable and biopharmaceutical medications dedicated to serving the needs of patients living with complex, chronic health and medical conditions. Walgreens Specialty Pharmacy provides personalized care and services through dedicated fulfillment centers across the country and more than 6,400 electronically linked Walgreens pharmacies, including locations in academic medical centers, community hospitals and physician office buildings. Walgreens Specialty Pharmacy assists patients in obtaining medications, coordinates insurance benefits and provides individualized therapy management and clinical support.

Walgreens (www.walgreens.com) is the nation’s largest drugstore chain with fiscal 2008 sales of $59 billion. The company operates 6,479 drugstores in 49 states, the District of Columbia and Puerto Rico. Walgreens provides the most convenient access to consumer goods and cost-effective health care services in America through its retail drugstores, Walgreens Health Services division and Walgreens Health and Wellness division. Walgreens Health Services assists pharmacy patients and prescription drug and medical plans through Walgreens Health Initiatives Inc. (a pharmacy benefit manager), Walgreens Mail Service Inc., Walgreens Home Care Inc., Walgreens Specialty Pharmacy LLC and SeniorMed LLC (a pharmacy provider to long-term care facilities). Walgreens Health and Wellness division includes Take Care Health Systems, which is comprised of: Take Care Consumer Solutions, managers of 247 convenient care clinics at Walgreens drugstores, and Take Care Employer Solutions, managers of worksite-based health and wellness services at more than 364 employer campuses.

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