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April 9, 2010

To Our Valued Duane Reade Customers:

We are very pleased to let you know that Walgreens acquisition of Duane Reade is official and that Duane Reade is now a vital part of the largest and most respected drugstore chain in the U.S. Not only are we delighted to join the Walgreens family of companies, which includes 70 stores in the New York City metro area, we are also happy to continue serving you as Duane Reade, the brand that has been serving New Yorkers for 50 years. As we move forward with this transition, Walgreens will consider the most effective way to harmonize both brands over time.

As you may recall, Walgreens believes we are a great fit for them in the New York City metro area because of our knowledge of the market and the unique approach we have taken to transforming our business, most of which has been based on your direct feedback. We are pleased that Walgreens is committed to supporting us in continuing this store transformation and to helping us achieve our goal to serve you better.

In the coming months we will begin to incorporate some positive changes into our model. The changes will benefit Duane Reade customers, particularly in the pharmacy, which will gain from the expertise by the leading community pharmacy network in the country. You may also notice some improved service and product offerings as we begin work with Walgreens on further enhancing the urban customer experience. That said, you can continue to count on us for the Duane Reade products and services that you have come to expect and appreciate.

Below you will find a few Frequently Asked Questions with answers about today's news. In the event that you have additional questions, please call us at 1-866-DR-LOYAL.

Thank you for allowing us to serve you.

Sincerely,

John Lederer
Chairman and CEO
Duane Reade

Frequently Asked Questions

Will the products or services offered at Duane Reade stores change?

For now, we plan to continue offering products and services that Duane Reade currently offers. If we see opportunities to add Walgreens products to Duane Reade's selection, Duane Reade customers may benefit from additional branded and private brand products we may offer. Walgreens may also see opportunities to roll out successful brands carried by Duane Reade in Walgreens stores. As always, we will continuously assess opportunities to enhance our product and service offerings.

Will Duane Reade's store hours change?

Duane Reade's stores will continue with their same hours and would only change as a result of normal business reviews, not because of the acquisition.

Will patients be able to transfer their prescriptions from a Duane Reade to Walgreens location (or from a Walgreens to Duane Reade location) and get the same price?

We plan to offer the capability for customers to transfer prescriptions from Walgreens to Duane Reade and visa versa eventually. In the meantime, Duane Reade customers can get their prescriptions filled at Walgreens with a telephone transfer. This is the same for Walgreens customers who would like to have their prescriptions filled at Duane Reade.

For patients who have insurance plans that are accepted at both Walgreens and Duane Reade, their co-pays will not change. Cash prices may vary between stores.

Will we rename the stores?

Duane Reade has a brand that reflects the heritage and soul of New York, and we want customers to know they'll see the same products and services they've come to know and trust. Walgreens currently plans for Duane Reade to continue operating under its brand name. With 70 Walgreens stores in the New York City metropolitan area, Walgreens will consider the most effective way to harmonize both brands over time.

Are we closing any Walgreens stores or Duane Reade stores?

Walgreens and Duane Reade's stores are largely complementary. As opportunities come up, we may relocate some locations to more convenient sites just as we do with locations today.

Can I use my FlexRewards card at Walgreens? Do my Walgreens purchases count toward FlexRewards points?

Currently, FlexRewards cards are only accepted at Duane Reade stores and Walgreens purchases are not counted toward FlexRewards points.

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