Wal-Mart Gets Into Diabetic Neuropathy Testing

Apr. 2.12 | About: Wal-Mart Stores, (WMT)

Wal-Mart Stores (WMT) has announced that it will soon begin diabetic neuropathy tests in 91 of its Canadian pharmacies. Understanding its cliental and the growth of this disease, the discount retailer seeks to offer cost effective nerve testing in its stores. A form 8-K filing released information on the $150,000 deal between Wal-Mart and Neurometrix (NURO), which will provide its DPN-CHEK test for diabetic peripheral neuropathy to the store. NURO, a stock that has fallen significantly in the past 5 years and is trading under cash, could see a windfall with such a big partner like Wal-Mart believing in and picking up its technology.

According to the American Diabetes Association, 60-70% of diabetics have some form of peripheral neuropathy. If diagnosed early, the condition can be managed. Currently, the market for diabetic neuropathy is approximately $2 billion a year in the US. Testing is currently done in point of care medical settings and is contingent on insurance coverage. It appears Wal-Mart is testing the waters in its Canadian market, which is home to 9 million diabetics compared to the nearly 26 million diabetics in the US. The Neurometrix DPN-CHEK ordered by Wal-Mart Canada could open diabetic neuropathy diagnostics at a more cost effective level to the masses.

Other Markets

As healthcare continues to ease more and more into pharmacies with options such as CVS' (CVS) MinuteClinic, Wal-Mart will have a unique if not temporary angle on the diabetic testing market. If Wal-Mart shows success with its move into the diabetic neuropathy market, look for others to join in the game. With its strong move into the accessible healthcare market, CVS would be a logical choice for diabetic neuropathy testing. Walgreen (WAG), another fixture in the North American pharmacy landscape, could successfully provide diabetic neuropathy testing. Could neuropathy testing become as common as checking blood pressure in a pharmacy?

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.