JPMorgan taps Walmart exec for new health venture

Walmart health care executive Cheryl Pegus will join JPMorgan Chase's Morgan Health venture as a managing director, with aims to improve employer-sponsored health care.

The move creates a vacancy at the nation's largest retailer, as rivals like Amazon.com and CVS Health broaden their reach into the $4 trillion U.S. health care industry. It's also a high-profile hire for Morgan Health, which the bank launched last year after shutting its joint venture with Amazon and Berkshire Hathaway, known as Haven.

Pegus, a cardiologist with a master's in public health, joined Walmart less than two years ago as executive vice president of health and wellness to lead the company's emerging strategy.

During her tenure, the company acquired the small telehealth provider MeMD, launched a new low-cost insulin and signed a deal with UnitedHealth Group to care for Medicare patients at Walmart Health centers.

Pegus called herself "an entrepreneur at heart" in an interview. As a managing director at Morgan Health, she'll work with the company's venture group investing $250 million in innovative health companies. Pegus said she was drawn to the opportunity to develop new approaches to health care that other large employers can replicate.

So far, Morgan Health has invested $105 million in four early-stage companies: Vera Whole Health, Embold Health, Centivo and LetsGetChecked, according to a statement on Monday.

"The work that we are doing in health care today feels different than pre-pandemic," she said in the interview. "There's a sense of urgency of how quickly we can move."

In addition to investing in startups, Morgan Health is testing new approaches to health benefits and care delivery for JPMorgan's own workforce. Dan Mendelson, Morgan Health's chief executive officer, said Pegus will bring clinical expertise to the bank's effort to improve care in areas like mental health, diabetes and other chronic diseases.

"There are a whole array of companies that are doing very interesting work in cardiology and in diabetes and in cancer," Mendelson said in an interview, adding that Pegus's "clinical depth is incredibly valuable to us."

Early career

Before joining Walmart, Pegus was a senior executive at Cambia Health Solutions, which operates health plans in the U.S. Northwest. She was previously the first chief medical officer at Walgreens Boots Alliance Inc., and has worked at drugmakers and as a cardiologist in private practice.

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Morgan Health has said it's focused on improving three areas in health care: quality, affordability and equity. Pegus said that has to take into account factors beyond the clinic that influence people's well-being: "Can you afford real health care? Do you have fresh food easily accessible? Are you able to travel for health care? If you were to do virtual visits, do you have access to that?"

Pegus will stay on as a senior adviser to Walmart. No successor has been named. Walmart shares slipped less than 1% in early trading on Monday.

In a statement, Walmart US CEO John Furner said, "The team is well-positioned to execute our compelling strategy of health care transformation."

"We are grateful to Dr. Pegus for advancing our mission of helping people live better and healthier, and we look forward to continuing to work with her in the future."

Mendelson and Pegus said there's no formal partnership between Walmart and Morgan Health, but the bank wants to create tools that large employers like the retailer can adopt. "Everything that we are doing at Morgan Health is intended to be reproducible and scalable across employers," Mendelson said.

— With assistance from Brendan Case.